By Grant McCool and Martha Graybow
NEW YORK (Reuters) - Several expected settlements in the coming weeks should boost the $1 billion (656 million pounds) recovered so far to pay back thousands of investors swindled by Bernard Madoff, the trustee winding down the confessed thief's firm said on Thursday.
Trustee Irving Picard told reporters on a conference call that he has filed lawsuits to recover $10.1 billion in fictitious profits of Bernard L. Madoff Investment Securities LLC after Wall Street's biggest investment fraud.
But getting that money back from the fraud of as much as $65 billion may not be easy, he said.
"In some cases the money is in foreign countries and is subject to court proceedings in the foreign countries as well as here," Picard said. "In some cases I'm sure the money has been expended by recipients, and in other cases in the United States, the recipients are still holding the money."
Picard, a New York lawyer spearheading a global search to return money to the swindler's former clients, has sued several hedge funds and Madoff "insiders" who fed the investment scheme over 20 years, but none of the disgraced financier's relatives in what was a family-run business.
"The fact that we haven't brought a lawsuit yet against a member of the Madoff family shouldn't be viewed as a fact that we're not going to, it's a matter that is being worked on," Picard said.
In documents filed in U.S. Bankruptcy Court on May 5, the trustee said the firm was a "piggy bank" for the extended Madoff family and close associates.
Madoff, 71, was arrested in December and he pleaded guilty in March to operating a huge Ponzi scheme, in which early investors are paid with money from new clients. Only he and an outside accountant have been criminally charged.
Madoff is jailed awaiting sentencing, which a U.S. judge postponed on Thursday to June 29 from June 16. He is likely to spend the rest of his life in prison.
NO COOPERATION BY MADOFF
Picard said Madoff had not cooperated with his investigation. He said some employees of the firm had been helpful and only three remained to assist with technical and accounting matters, but none was related to Madoff.
Picard said $1 billion had been recovered so far under the auspices of the Securities Investors Protection Corp (SIPC), but it was "too soon to project or speculate" on the final amount that can be found.
"My counsel has been in negotiations with several parties that I expect to result in significant settlements in the next several weeks," Picard said.
SIPC president Steve Harbeck said on the conference call that they were "at the end of the beginning" of the complicated case.
SIPC, established in 1970 to help customers of failed brokerages, has committed $61.4 million to paying 125 Madoff client claims so far.
Those commitments are likely to reach or exceed $100 million by May 25. Most payments approved so far are for $500,000, the SIPC's limit.
So far, 8,848 customer claims have been filed in connection with 3,565 customer accounts at Madoff's firm, SIPC said.
Picard described the scheme as "the largest and most complex securities fraud in history" that presents "unique difficulties rarely encountered in the typical failure of a broker or dealer."
He said there were paper records, microfilm or microfiche and nothing that was electronic.
It was difficult to know how much money was put in over the decades because "we don't have visibility yet" into the full period before December 1995, the trustee said.
The case is Securities Investor Protection Corp v Bernard L. Madoff Investment Securities 08-01789 in U.S. Bankruptcy Court for the Southern District of New York (Manhattan)
(Reporting by Grant McCool and Martha Graybow; Editing by Brian Moss and Tim Dobbyn)
