Tuesday, December 16, 2008

Did You Invest in Madoff? Here’s What You Need to Know . . . Plus: Table of Investors

From the Wall Street Journal's Law Blog:

Seemingly disparate entities, such as the Palm Beach Country Club, the Elie Wiesel foundation, Spain’s Grupo Santander and Steven Spielberg’s Wunderkinder Foundation are all left wondering whether, when the smoke clears, there will be anything left of the money they invested with Bernie Madoff’s investment firm. (Click here for today’s WSJ front-pager detailing the alleged Ponzi scheme’s extraordinary reach.)

According to a separate story in today’s Journal, and additional reporting from the WSJ’s Dionne Searcey, while there may be very little money left to fight over in the Madoff case, lawyers are circling to duke it out for what’s left. However, even those Madoff investors who pulled money out before the scheme unraveled may have to pony up.

Past Ponzi scheme cases such as Bayou Hedge Fund and the case involving the International Management Associates, which bilked some $150 million from thousands of clients, among them Denver Broncos players, show that investors who’d taken out money may be subject to redemption claims or so-called clawbacks. Some of these types of claims could come should Madoff’s firm file bankruptcy. A trustee would argue that money taken out in years’ past never really existed because it was a Ponzi scheme and any money paid out was really someone else’s money, not an asset of the fund. The trustee would ask for the return of the money so it could be pooled and distributed among the victims....MORE

And from Bloomberg:
Madoff’s Investors Had $30 Billion at Firm: Table
Investors had at least $29.9 billion in funds overseen by Bernard Madoff, the money manager arrested last week in an alleged fraud, according to data compiled by Bloomberg and media reports.

Madoff, 70, told employees before his arrest last week that his firm was “a giant Ponzi scheme” that may have cost clients as much as $50 billion. The following is an alphabetical list of Madoff’s investors.

Client                   Total          Source

Access International $1.4 billion Company statement,
Advisors Bloomberg Data

Banco Santander SA 2.33 billion Company statement
euros ($3.1

Banque Benedict Hentsch $48 million Company statement
& Cie. SA

BBVA 300 mln euros Company Statement
($404 mln)

Benbassat & Cie. $935 million Reuters, citing Le Temps

BNP Paribas SA Up to 350 Company statement
million euros
($478.2 mln)

Boston philanthropist $145 million Boston Globe
Carl Shapiro’s

charitable foundation