NEW YORK (Reuters) - About $946 million has been recovered so far from the firm of accused swindler Bernard Madoff, the trustee overseeing its liquidation said on Wednesday, but he lamented the relatively slow pace of the probe to satisfy investor claims.
Gaining access to computers at Madoff’s firm and examining 7,000 unmarked boxes of documents stored in a warehouse is taking time, trustee Irving Picard said in remarks during and after a hearing in U.S. Bankruptcy Court in New York.
“We have worked out protocols but there are parts of the building we cannot go without permission and escort by the FBI,” Picard, a lawyer, said in court. “That caused problems gaining access to computers.”
After the hearing Picard told reporters the FBI, prosecutors and securities regulators were “very cooperative” as they all probe the alleged $50 billion global fraud, perhaps the most complex in Wall Street history.
The Manhattan offices of Bernard L. Madoff Investment Securities LLC was declared a crime scene after the veteran investment manager’s December 11 arrest.
Spokesmen for the FBI and the Securities and Exchange Commission declined comment. The office of the U.S. Attorney has a policy of not commenting on investigations.
Picard is working with the Securities Investor Protection Corporation (SIPC) to liquidate the brokerage and find assets to distribute to customers defrauded by Madoff. SIPC is a nonprofit established by Congress in 1970 to maintain a reserve for swindled brokerage investors.
Madoff’s firm had a brokerage and an investment arm.
Picard said the thousands of boxes of the firm’s documents were found in a warehouse in the New York City borough of Queens.
He told reporters after the hearing that 16 people were sent to compile an inventory of the boxes. “Their job is not to study or analyze the records. That is down the road.”
U.S. Bankruptcy Court Judge Burton Lifland said at the close of the hearing that he hoped the many government agencies assigned to “this financial debacle” are working “in harmony to recover those assets.”
Picard told the court that at the close of business on Tuesday, $111.4 million in cash had been recovered from banks and other financial institutions where the firm had accounts.
He said a further $300 million in securities had also been recovered in addition to $535 million from JPMorgan Chase & Co and Bank of New York Mellon Corp accounts.
On Wednesday, the judge approved transfer of $301.4 million from Bank of New York and $233.5 million by JP Morgan to the trustee.
“It is our intention to designate those funds as customer property,” Picard told the court of the amounts that added up to $946.4 million. “It is our intention to have all these funds, and funds from assets we are able to collect, to go into the customer fund and distribute to the victims.”
The deadline for Madoff’s customers to make a claim with the SIPC is July 2, the trustee said.
The case is Securities Investor Protection Corp v. Bernard L. Madoff Investment Securities LLC 08-01789 in U.S. Bankruptcy Court for the Southern District of New York (Manhattan).
Reporting by Grant McCool; Editing by Tim Dobbyn