For an investor with a claim of $4 million, for example, ASM will write a check for $800,000 in exchange for the full claim; or the investor could take $640,000 plus 33% of future proceeds ASM receives above that amount. Those sums would be in addition to any $500,000 payouts made by Securities Investor Protection Corporation to investors.
It isn’t yet clear how much money Bernard Madoff’s investors will recover from their losses.But some companies are ready to bet the payouts will be worth the wait.ASM Capital, offering two options for Madoff victims to sell their claims, says response has been surprisingly positive. ‘Usually in Ponzi schemes,’ said President Adam Moskowitz, ‘people are not that trustful after.’ Just as Wall Street traders place wagers on almost any company or event, some investors are approaching victims of Mr. Madoff’s Ponzi scheme, offering to buy them out at a discount for their claims to what is eventually recovered by Irving Picard, a court appointed trustee who is gathering assets for Madoff victims. The offers are going to investors with claims allowed by Mr. Picard.
By Gregory Zuckerman, June 4, 2010 WSJ