The fifth round of payments will bring the total funds returned to $7.4 billion, according to an update from the Securities Investor Protection Corporation. This includes committed advances of around $822.5 million from the SIPC.

“The fifth distribution is yet another important milestone for the Madoff Recovery Initiative,” said Irving Picard, the trustee. “My legal teams have negotiated important and significant recovery agreements with several defendants. That work enables us to move ahead with this distribution, once we have the approval of the court.”

The average payment in this distribution will total around $299,900 while the largest is almost $61 million. The fifth interim distribution - combined with the four prior interim distributions - will satisfy up to 48.546 per cent of each client's allowed claim amount, unless the account is fully satisfied.

As at end-November, Picard has recovered, or has reached agreements to recover, some $10.5 billion since his appointment as trustee in December 2008.

Madoff's investment scandal, which was revealed in December 2008, spanned decades and defrauded clients of approximately $20 billion, Picard says on the The Madoff Recovery Institute's website. The unveiling of Madoff's crimes caused shockwaves in the wealth management industry - and indeed financial sector at large - over the rigor of due diligence that is carried out on investments. His Ponzi scheme is considered to be the largest financial fraud in US history, for which he is serving a 150-year prison sentence.

A hearing on the fifth allocation and distribution motion has been set for January 15, 2015.