![Irving H. Picard, at the head of the table, with members of his legal team overseeing the claims for victims in the Madoff fraud. [J.B. Reed for The New York Times]](http://www.vinnews.com/wp-content/uploads/2009/08/picard1.jpg "picard1")
New York – Angry victims of convicted Ponzi schemer Bernie Madoff are up in arms over as much as $250 million in legal fees they claim will be paid to Irving Picard, the court-appointed trustee overseeing the break-up of the fraudster’s fake investment firm.
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The victims, who claim they are being treated unfairly by Picard and the Securities Investor Protection Corp. (SIPC), the body set up to provide insurance for victims of securities fraud, are set to air their grievances in New York Bankruptcy Court on Thursday.
Chief among their complaints are the massive legal fees Picard and his firm, Baker & Hostetler, are charging. So far, the firm has claimed more than $15 million, or around $1 million a week, in fees for 3½ months of work. Picard believes it could take as long as five years to settle all Madoff claims, which means his firm could reap at least $250 million from the bankruptcy.
If approved by the bankruptcy court, those fees will be paid out of SIPC’s coffers. The victims claim in court papers filed last night that the money being claimed by Picard is rightfully theirs.
Neither Picard, nor Stephen Harbeck, CEO of SIPC, returned calls.
“It is unconscionable that SIPC should be squandering potentially hundreds of millions of dollars when it doesn’t even have enough money to compensate all the victims who have filed a claim,” said Helen Davis Chaitman, a lawyer representing more than 100 Madoff victims in the case.
Picard and his colleagues at BH have done a brilliant job at sorting out the most complex ponzi scheme in history and recovering more money than anyone initally thought was possible. These “victims” groups should be grateful to him and stop whining about his fees. They are the normal and reasonable fees charged for this type of work and will have to be approved by a judge before they are paid out. He is not doing this work pro bon or as a charitable contribution. If the victims know where more money is hidden, they should come forward. If not, be thankful you are getting anything.
As is always the case in these kinds of situations, the only ones to walk away winners are the lawyers. The same is true for protracted divorce cases, class action lawsuits and especially bankrupcies.
The actual victims usually get the short end of the stick while the lawyers laugh all the way to the bank.
It’s just how our litigation system works. No one has come up with a better system yet.
these lawyers keep up the whole criminal system
Lawyers are sharks.
judge chinn is a tryant and a dictator what he says go,but in the wexfraud case he did cut fees quite allot.the question is why not give the deal to a bidding process,why not cap it,why do we pay for first class travel,5 star hotel and meals for these guys.and picard may have found a billion maybe some other firm would have found 2 billion.lawyers should be pad like the judges,whom i doubt get 700 dollars an hour as that would work out to 28k a week,take down overhead it is still a fortune
1 million dollars a week is a little fishy. Do the math: even if the average lawyer on the case charged 500 dollars an hour (unlikely in a case this scrutinized, especially taking junior associates into account), that amounts to the equivalent of fifty lawyers working full time on this case alone (1,000,000/500 = 2000/40 = 50) , and all from one firm.
I don’t think even Enron got that treatment.
Why the need for such a high powered legal firm to handle this? A bit like the surgeon general doing veterinary autopsies lehavdil. Let the $80,000 per year junior prosecutor handle this.
The same ehrleche yiddin who complain about Obama’s interference with the private sector and health insurance seem to be the same ones who scream about lawyers and doctors making too much money. You can’t have it both ways.
Okay, it takes a brain to sort through the repayment, but honestly, is there actually anything left to pay these people aside from the change in the Louis XIV sofa?