* Madoff trustee plans to distribute $505 million
* Payout to exceed $5.4 billion upon approval
By Jonathan Stempel
NEW YORK, Feb 13 Bernard Madoff's defrauded
former customers will see the total amount of money returned to
them surpass $5 billion if the trustee liquidating the
imprisoned swindler's former firm wins court approval to
distribute another $505 million.
The trustee Irving Picard plans to seek permission from U.S.
Bankruptcy Judge Burton Lifland, who oversees the liquidation of
Bernard L. Madoff Investment Securities LLC, according to a
posting Tuesday on the trustee's website.
If the judge grants approval for the third distribution, the
amount of money advanced or distributed to customers would rise
to $5.44 billion, close to half of the 2,499 claims totaling
$11.05 billion that Picard has deemed "allowed".
Picard said he and his lawyers "are well aware of the need
to return recovered funds as quickly as possible to those from
whom the funds were stolen. They are constantly assessing all
relevant issues to determine when it will be possible to make
another pro rata interim distribution."
The trustee has estimated that Madoff's former customers
lost $17.3 billion in the fraud, which surfaced in December
He is withholding some money from distribution because of
litigation and other issues related to the liquidation.
Madoff, 74, pleaded guilty to running a Ponzi scheme in
March 2009. He is serving a 150-year sentence in a North
Carolina federal prison.
The case is In re: Bernard L. Madoff Investment Securities
LLC, U.S. Bankruptcy Court, Southern District of New York, No.