Santander Hedge Funds Settle Madoff Trustee Claims

May 27 2009 | 8:23pm ET

A pair of Bernard Madoff feeder hedge funds has agreed to settle with the court-appointed trustee in the case, returning more than $200 million they withdrew from their Madoff accounts in the months before his $65 billion Ponzi scheme collapsed.

The two Bahamas-domiciled funds managed by Banco Santander’s Optimal Investment Services will return $285 million, 85% of the total they withdrew from Bernard L. Madoff Investment Securities in the 90 days before his arrest in December. In exchange, the funds would be protected against further claims by the trustee, Irving Picard, and will receive $500,000 for their own claims against Madoff.

The deal still requires the approval of the U.S. Bankruptcy Court overseeing the liquidation of Madoff’s empire.

“I am very pleased that we have reached such a favorable settlement,” Picard said. “We hope that other entities against which we have claims will likewise come forward to settle those claims for the benefit of all of Madoff’s victims.”

Those wishing to do so now know what they are in for: at a minimum, agreeing to return 85% of their withdrawals in the 90 days before Madoff’s arrest. If Picard reaches a better deal with any other party, he must retroactively offer it to the Optimal funds.

The agreement also boosts the amount Picard has recouped for the victims of the fraud to more than $1.25 billion.


In Depth

Humble in Hofstra...One Debate an Election Can Make

Sep 26 2016 | 10:20am ET

Tonight's U.S. Presidential debate, infamously coined the “Humbling in Hofstra...

Lifestyle

Quattrex Sports AG Debuts Soccer-Focused UCITS Fund

Sep 9 2016 | 9:54pm ET

Innovative alternative investment company Quattrex Sports has unveiled a new UCITS...

Guest Contributor

Malik: The Ever-Changing Middle Market and The Entering Class of 2016

Sep 2 2016 | 5:01pm ET

Deal sourcing and origination is only going to get more competitive given current...