The Madoff investigation finally extends to another feeder fund, albeit in Europe.
We’re still waiting for someone to look into Fairfield Greenwich Group. We suspect the crime there is willful denial or incompetence rather than outright fraud, but certainly seems worth a look-see.
Eric Frey, FT: The Vienna state prosecutor has launched a criminal investigation against Sonja Kohn, Bank Medici president and majority shareholder, on suspicion of fraud and breach of trust relating to more than $2.1bn in funds her bank funnelled to Bernard Madoff, who is accused of operating a $50bn “Ponzi” scheme.
A prosecutors office said the investigation was directed against Mrs Kohn, Bank Medici and several current and former bank managers.
The complaint argues that Bank Medici presented the funds as low-risk vehicles and hid the fact that the customers never acquired actual ownership rights over the shares they received…
Bank Medici was taken over by Austrian authorities this year after the close ties to Mr Madoff were revealed. The bank is still formally open, but is not conducting any significant business. The bulk of its revenues came from fees generated by placing funds with Mr Madoff.