There will never be good news for Bernie Madoff, but this is an especially tough blow for the incarcerated schemer. A federal judge in Manhattan overruled the Securities and Exchange Commission on Friday and will now allow Madoff to be forced into personal bankruptcy by his investors. Judge Louis L. Stanton (likely a savior in the eyes of many) removed the roadblock, saying that the benefits of protecting Madoff’s victims outweighed the time and cost expense, writes The New York Times. Hedge funds may also be able to recoup their losses and pay back their own investors. The SEC preferred to obtain Madoff’s assets through criminal forfeiture laws, but Judge Stanton felt bankruptcy would be more effective.
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