Word: sipa
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...Picard, in his late 60s, is a rare bird in the quiet world of bankruptcy trustees, a blend of a traditional Chapter 7 bankruptcy panel trustee (of which there are 1,200 in the U.S.) and Securities Investment Protection Act (SIPA) trustee...
...SIPA trustee handles bankruptcies when the Securities Investor Protection Corp. (SIPC) steps in to take charge of fallen brokerage houses. Picard is considered the superstar of SIPA trustees, having handled the largest cases SIPC has managed, and other large non-SIPC cases, such as portions of airline TWA's bankruptcy. He has participated in at least 38 major bankruptcy decisions. According to Stephen Harbeck, president of the Securities Investors Protection Corporation, Picard has served as trustee in more brokerage firm liquidations than anyone else in the U.S. (See the worst business deals...
...SIPA trustee's job, not unlike a Chapter 7 trustee, is to recover property, assess claims and liquidate any other assets of a bankrupt firm for the benefit of the estate and its creditors. Consequently, Picard is using his authority to collect from customers who received preferences, non-existent principal, and/or payouts of fictitious profits to the detriment of other defrauded customers whose money was consumed by Madoff's global Ponzi scheme...
...Picard still stands to put a pretty penny in his pocket. SIPA trustees like Picard and their staffs get hourly fees and expenses paid for, as well as discretionary amounts based on a number of factors...
...Normally, Chapter 7 bankruptcy trustees personally receive 3% of anything over $1 million they recover for victims. In SIPA cases, however, the amount is not based strictly on a percentage of monies recovered since often there is no money remaining in accounts...