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July 27, 2011 at 08:00 PM
Irving Picard, the trustee for the liquidation of Bernard L. Madoff Investment Securities L.L.C., says he has reached a settlement with about a dozen funds and affiliates of Tremont Group Holdings Inc.
Tremont, Rye, N.Y., manages the Rye Select and Tremont families of funds, which invested money with Bernie Madoff’s firm.
An affiliate of the OppenheimerFunds acquired Tremont in 2001. Oppenheimer Funds, in turn, is a unit of Massachusetts Mutual Life Insurance Company, Springfield, Mass.
In addition to the Tremont funds, the settlement Picard negotiated includes MassMutual, MassMutual Holding L.L.C., and MassMutual’s Oppenheimer Acquisition Corp., Picard says.
The defendants have agreed to provide $1 billion in cash for a customer fund, and the cash eventually will be paid to Madoff firm customers with allowed claims, Picard says.
The proposed settlement is subject to approval by the U.S. Bankruptcy Court for the Southern District of New York.
Picard says that he already has recovered $2.6 billion for the customer fund, and that a settlement for another $5 billion recovery is under appeal.
Picard estimates he has recovered or is closing to recovering a total of $8.6 billion in assets, or about 50% of the $17.3 billion in principal lost in the Ponzi scheme by customers who filed claims.
