Tuesday, 27 January 2015
Last updated 3 hours ago
Dec 6 2010 | 4:25am ET
His time may be running short, but the court-appointed receiver in the Bernard Madoff case saved some of his biggest shots for last.
Irving Picard yesterday sued HSBC for at least $9 billion, accusing the banking giant of aiding and abetting Madoff's massive Ponzi scheme by building and marketing a network of a dozen feeder funds. It is the largest lawsuit filed by Picard, who is seeking more than $30 billion in more than 100 lawsuits against Madoff investors, family members, employees and affiliates.
Last week, Picard sued JPMorgan Chase for $6.4 billion and a week before sought $2 billion from UBS.
As with his other cases against Madoff's banks, service providers and funds of hedge funds, Picard accuses HSBC of ignoring a veritable forest of red flags.
"Had HSBC and the defendants reacted appropriately to warnings and other obvious badges of fraud outlined in the complaint, the Madoff Ponzi scheme would have collapsed years, billions of dollars and countless victims sooner," Picard said. His lawsuit, which features 24 counts against the bank, alleges the HSBC is guilty of "contribution to Madoff's scheme, aiding and abetting Madoff's fraud, unjust enrichment in the form of millions of dollars and over $2.3 billion in fraudulent transfers."
The Madoff Ponzi scheme is believed to have cost investors more than $20 billion. Madoff himself is serving a 150-year prison sentence after pleading guilty to the fraud. Picard has to date collected about $1.5 billion to return to the scam's victims.
Picard faces a Saturday deadline—the two-year anniversary of Madoff's arrest—to file lawsuits seeking to recoup money.
Jan 23 2015 | 1:00pm ET
In our new section, FINtech Focus, we will profile one of these firms each week. While fintech is a broad category, we will be focusing on firms that specifically cater to the alternative investment industry. Read more…