HSBC Settlement With Madoff Feeder Investors Junked

Sep 9 2011 | 12:39pm ET

HSBC can't escape liability for its role as the custodian for a Bernard Madoff feeder fund for a mere $62.5 million.

A federal judge in New York has rejected that proposed settlement with investors in the Thema International Fund. U.S. District Judge Richard Berman blasted a number of "obvious deficiencies," including a provision giving $10 million to the lawyers in the class action suit to sue non-settling defendants outside of the U.S.

The proposed settlement is "not fair, reasonable or adequate, even at this preliminary stage," Berman ruled.


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The U.S. Commodity Futures Trading Commission (CFTC) ordered The Goldman Sachs Group Inc., and Goldman, Sachs & Co. to pay a $120 million penalty for attempted manipulation and false reporting of ISDAFIX Benchmark Rates, a global benchmark for interest rate products.