Maybe some group made him an offer he couldn't refuse. "Bernie, we have the goods on you and you are going to go down. Now you can live the rest of your life in prison with your wife and sons, or you can use what is left of the money to help _____. If you work with us, your reputation will be ruined but your family will be protected and (maybe) you will be allowed to escape somewhere for the rest of your years."
This would be described as a 'clawback' and described in the following article: http://www.nytimes.com/2008/12/19/business/19ponzi.html?hp Google 'clawback + madoff' for more stories of the same topic....
people can make all kinds of demands careful reading of the article suggests that . it is one lawyer's interpretation and nothing more. judges make erroneous ruling all the time. that is why u have appeals courts. innocent parties will find tooth and nail not to give up any received winnings. perhaps this a new niche for the insurance industry. they can create insurance against fraud for hedge fund distributions. why should any of these losses be covered by SIPC? this is not a case of broker fraud.
c'mon, give the guy a break, he's an old man, he's confused (uncle leo). he forgot where he put his money. actually he looks very good for his age. my only hope is that bernie gave away the cash to poor people around the world (palestinians included). the next time a mistery benefactor approaches you with a crisp $100 bill in a goodwill store (it's a second hand store for those of you who read this and are bernie's "victims") think it might come from bernie. and don't scream "thief" too loudly, it might come around and chase you as to where you got your cash in the first place. you want sec protection and hand holding now, but when bernie was "the jewish bond" and handed you 10% yr no matter what, you wanted sec to stay away so that if bernie was doing some insider trading nobody bothered him. well, you can't have it both ways. oh no, say it ain't so, little tel aviv (palm beach) is in financial distress. oh, but wait, it is an insider who screwed them, how bizarre, i thought they were not supposed to steal from one another. it was ok to steal from the poor, but from rich? that's crazy. bernie went from the "jewish bond" to the "jewish robin hood". he decided that all the charities he "served" were not worthy and came up with his own "charity". and for people unaffected who are screaming on the forums against bernie, get a life, "the victims" don't care if you lose your few tens of thousands in 401k, don't lose sleep over their losses.
Looked like the early Madoff investors were Jews who withdrew money regularly from their accounts, had you with Madoff from the beginning the game, you would have gained 1.1^30 = 17 times of return, ... So most the lost money weren't really lost, they found way to Jews charity programs.
Who are the last players of Madoff games? European and Japanese Banks (No German banks). Let's guess what happened: Jews were slaughtered in Europe during WWII, 40 years after WWII, European again treated German like an old friend (Same American) that must hurt Mr. Madoff so much and he decided to punish the European Banks. So Mr. Madoff increased his fake return to pay Jews charity programs which withdraw money regularly while European Banks continue to pour money in. German Banks on the other hand, still don't trust Jews so they didn't bite. Look into Madoff's eyes after his arrest, he is like a winner, shows no regret, did that tell you something?
Enough idiocy, here's another link of interest http://www.time.com/time/business/article/0,8599,1866398,00.html
One thing I would rebutt here is that most hedge funds do not run self-clearing broker dealers. Most use prime brokers. When you have a prime broker, your assets are custodianed with a presumably unaffiliated third party and it makes the assets in the funds verifiable thru the third party's books and records. When you run a self-clearing broker dealer that carries all the accounts of the fund then it makes it easier to concoct false statements and perpetuate the fraud.
3rd party, ok. But I have postulated that IN GENERAL, hedge funds are run by folks that would sell their mothers for a buck. So if you want to gamble that you are in the exception, and not worry, be my guest. It is after all YOUR MONEY. 4 now.