Five years after Ponzi-scheme operator Tom Petters’s arrest, the recipients of his largesse are still paying for his crimes, the Wall Street Journal reported today. Following Petters’s arrest, his business empire—which once encompassed Polaroid and Sun Country Airlines—filed for bankruptcy protection. The collapse of the fraud also led to the bankruptcies of several large feeder funds, which gathered up investor dollars and funneled them to Petters. Those cases wind on, as bankruptcy trustees file clawback lawsuits to recover funds and work to track down assets to pay creditors. The trustee overseeing the bankruptcy wind-down of Petters Co., for instance, has brought more than 200 clawback suits against more than 380 defendants. So far, court papers show that the litigation has brought in $21.5 million, and more suits remain pending.
