Why was it so easy for Bernie Madoff to pull off a massive Ponzi scheme? Because the funds who led their clients to slaughter fattened up on almost $800 million in fees and really didn’t think it was a good idea to ask too many questions.
This tasty nugget came out of the court documents as prosecutors and plaintiffs’ attorneys try to hunt down ill-gotten gains of Madoff and the cadre of people around him who got rich. Whether any of that money comes back to Madoff clients is another story.
Among the big fee winners, according to the WSJ:
•Banco Santander earned $52.7 million in 2007 and $43.3 million in 2006 in “investment manager’s fees.”
•A unit of Tremont Group Holdings could have collected as much as $34 million in fees annually.
•J. Ezra Merkin took in almost $170 million from Madoff vehicles over 12 years, according to a complaint against him.
•The granddaddy of Madoff feeder funds, Fairfield Greenwich, collected at least $400 million between 2005- 2008, according to Massachusetts securities regulators.