Saturday, 20 December 2014
Last updated 1 day ago
Jun 7 2011 | 12:45pm ET
Some of the investors burned in Bernard Madoff’s Ponzi scheme have scored a $62.5 million settlement in a lawsuit against HSBC Holdings, which acted as his custodian.
The class-action suit was filed against several HSBC units and other defendants by investors in Ireland’s Thema International Fund. The fund’s assets had been invested with Bernard L. Madoff Securities.
In a statement quoted by Bloomberg, HSBC said the settlement “shall in no way be construed” as an admission of fault, adding that it had “good defenses” against Madoff-related suits it faces in Germany, Luxembourg and other countries.
According to a statement by the fund’s law firm, Chapin Fitzgerald Sullivan & Bottini, the Thema Fund was controlled by Bank Medici. Bank Medici and its founder, Sonja Kohn, are part of a $59 billion suit filed by the court-appointed trustee liquidating Madoff’s firm.
The bank has stated it knew nothing of Madoff’s fraud and lost $1 billion itself in Madoff feeder funds. But according to KPMG reports obtained by Bloomberg, auditors twice warned HSBC that investing client funds (as much as $8 billion) with Madoff left it open to “fraud and operational risks.”
The deal still needs court approval.
Dec 1 2014 | 10:21am ET
As 2014 winds down, Northern Trust Hedge Fund Services executives took some time to share their outlook on trends facing the industry in 2015. Read more…
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