U.S. Judge To Seek HSBC Madoff Fraud Reports

Aug 20 2010 | 1:05pm ET

A U.S. judge is urging the British courts to force HSBC to hand over a series of reports with the explosive title, “HSBC Bank plc Review of fraud and related operation risks at Bernard L. Madoff Investment Securities,” written in the years prior to Madoff’s arrest in December 2008.

U.S. Bankruptcy Judge Burton Lifland agreed to ask the London High Court to order HSBC to hand over the reports, as well as contracts, audio recordings and other documents related to the risk reviews conducted by KPMG International on behalf of the bank. The records are being sought by court-appointed receiver Irving Picard, who has already reached a deal with HSBC on what will be turned over if the British court acts.

The KPMG reports date from 2006 until 2008, and the other documents include a July 17, 2008, recording of a KPMG presentation on the risks at Madoff’s firm, five months before the $65 billion Ponzi scheme collapsed. The last review came in September, about three months before Madoff’s arrest.

HSBC served as the custodian of several Madoff feeder funds, and has been sued by those feeder funds, as well as their investors, following the revelation of the Madoff fraud. Picard is also suing HSBC and one of the feeder funds, Herald Fund, for $578 million. Herald is also suing HSBC.

HSBC has since dissolved its Luxembourg-based custodian following its heavy losses in the Madoff case.


In Depth

Part II: Roubini Talks Risk, Recovery And The Threat Of A Triple Dip Recession

Oct 21 2014 | 12:41pm ET

In the second half of our interview with Nouriel Roubini, FINalternatives editor...

Lifestyle

Balyasny Pays Over $6M For Lakefront House

Oct 22 2014 | 10:29am ET

A venture headed by hedge fund manager Dmitry Balyasny just paid $6.2 million for...

Guest Contributor

Hedge Funds Weather A Data Management Perfect Storm

Oct 22 2014 | 12:28pm ET

From a regulatory standpoint, nearly every development since the crisis has placed...

 

Videos

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

October 2014 Cover

Deeply flawed risk benchmark

Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.