TPM:
There's not much hope for people who lost their shirts on the Madoff scam. But you'll be happy to hear that some of them will recoup losses courtesy of your tax dollars.
I'd heard recently that among its other choice decisions, AIG (now a ward of the federal government) had managed to offer insurance for some of Benard Madoff's fraudulent investments. The dollar amounts aren't that high. So far AIG has received 85 claims for Madoff losses. And the individual policies only cover up to $100,000, though I'm told the policies were sometimes layered together in ways that could make the effective insurance limits much higher.
What's more, a private insurance company can insure anything they want, be as stupid as they want to be.
But the fact that some of your tax dollars are going to go to people who lost money to Madoff does get us back to the premise of the government's take over of AIG, and to be specific, the highly questionable premise that AIG isn't simply bankrupt.
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