There are two ways of reading the plans of the Bernie Madoff fundraisers at the Fairfield Greenwich Group to take their firm public.
Innocent. Perhaps the fact that the firm’s attempt to go public shows that its managers really believed they had a good business and that they were totally unaware that Madoff was running a scam, despite a decades long association with Madoff. Going public would have subjected their operations to heavy scrutiny and regulatory attention. It doesn’t seem like something you’d want to do if you regarded your company as part of a scam.
Guilty. Then again, FFG’s owners were trying to cash out, which would have allowed them to finally gain some independence from Madoff. Perhaps they knew that eventually the cat would get out of the bag, and hoped to sell the bag while the cat was still safely inside.
The Real Estate section of the New York Times tells the story of Richard Murphy, the man FFG hired to help them prepare for the IPO.
He had moved to New York in 2007 to join a thriving $14 billion hedge fund known as the Fairfield Greenwich Group. His job: to prepare the group to go public and make the partners even more fabulously wealthy.
Now he is out of a job…Only a year and a half ago, Mr. Murphy had triumphantly moved to the upper echelons of the Upper East Side after a 20-year career as an investment banker in Europe, working for Morgan Stanley, Deutsche Bank and Credit Suisse…
Now Mr. Murphy is listed as a defendant, along with other Fairfield Greenwich partners, in lawsuits brought by distraught investors.
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