> An interesting part of Madoff recoveries were through settlements against originators/feeder funds because they « ought » to have known it was a ponzi.
Did the judge say that? I would think the logic was that they were effectively getting stolen money as gifts. Like when a scammer gives their victims' money to their own family. Doesn't matter if they were in the dark or even spent it already.
As I understand it, if stolen/scam money is used to buy something it's not the seller's responsibility because money is legal tender. On the other hand, if a stolen item is sold, the issue of knowing where it came from does becomes important.
Re:What Happened at Alameda Research
by Scoundreller on Tuesday November 15, 2022 @01:04PM
(#33612711)
No, but I think they were all settlements, so one needs to read between the lines.
But maybe you’re right and it’s just recoveries of their commissions etc.
Unsure if FTX creditors will be able to do the same.
But mostly, Madoff himself didn’t really spend much money. Just did nothing with it. The few pieces of fancy real estate he lived in were actually profitable because he didn’t build some gawdy illiquid palace.
But there was a lot of time-value loss that isn’t accounted for. Even 14 years later there are still distributions. Even getting $1 back on your 1995 $1 is still a big loss.