Second Circuit Affirms Madoff Trustee’s Use of “Net Investment Method” to Calculate Net Equity Under SIPA
Yesterday, the Second Circuit ruled that the Trustee in the liquidation proceedings of Bernard L. Madoff Investment Securities LLC (“BLMIS”) properly used the “Net Investment Method” to calculate “net equity” under the Securities Investor Protection Act (“SIPA”). As a result, BLMIS customers may seek recovery under SIPA based on amounts deposited minus amounts withdrawn rather than based on the market value of securities reflected on final BLMIS account statements.