Madoff Victims May Start Getting Cash Within a Month, SIPC Says

The Madoff case “is of a completely different order of magnitude” from anything SIPC, set up to protect small investors, has seen before, Harbeck said. The group has $1.6 billion in assets, $1 billion in credit available from the U.S. Treasury and another credit line from an international consortium of banks.

Harbeck said he doesn’t know if SIPC will need to ask the Treasury or Congress for additional money, or whether resolving the Madoff losses will wipe out the group’s funds. Since an investor with a $100 million claim is limited to $500,000, the claims “might not necessarily exhaust our resources,” he said.

SIPC doesn’t have “a fraction of what they need” to reimburse Madoff investors, Thomas Orecchio, who was chairman of the National Association of Personal Financial Advisors until September, said in a Jan. 5 interview. “It’s not going to go very far.”