Tremont Group Holdings Inc. must face an investor lawsuit over losses tied to Bernard Madoff’s fraud, a state appeals court ruled. The Washington state appeals court revived a lawsuit brought by a group of investors, including FutureSelect Portfolio Management Inc., that lost $195 million in Tremont’s feeder fund when Madoff’s Ponzi scheme collapsed. The ruling reverses a lower court’s dismissal of claims against Tremont, its parent Oppenheimer Acquisition Corp., Oppenheimer’s parent Massachusetts Mutual Life Insurance Co. and auditor Ernst & Young LLP.
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Reality finally caught up with Bernie Madoff on December 11, 2008. Arrested at the $7m Manhattan penthouse he shared with his wife, Ruth, the man who had run a decade long pyramid scheme made an emotional confession to his sons that “it’s all just one big lie”. Securities and Exchange Commission investigators spoke of “a stunning fraud that appears to be of epic proportions”. Their suspicions proved correct. More in The Telegraph [...] NEW YORK (AP) — [...]romance flourished in the offices of disgraced financier Bernard Madoff even if real investing did not, the government has revealed, disclosing among other revelations that even the Ponzi king himself was involved in a love triangle with a subordinate now facing trial. But the government’s foray into sharing bedroom secrets was just a tiptoe, as prosecutors refused to get into the details or identities of those involved in the dalliances without the blessing of a federal judge. Five of Madoff’s former employees pleaded not guilty Friday in federal court in Manhattan to the latest indictment in the case. Their trial is due to start Oct. 7. More in USA Today [...] A judge’s decision to ban convicted multibillion-dollar swindler Robert Allen Stanford’s top manager in Baton Rouge from the securities business is a significant step forward for small investors, a local attorney said Thursday. Jason T. Green, 50, a 13-year Stanford employee who managed the Baton Rouge office before becoming Stanford’s private-client group president in 2007, also was ordered Aug. 2 in Houston to surrender $2.6 million of his earnings and pay a civil penalty of $260,000. The decision by Administrative Law Judge Carol Fox Foelak “is very significant in terms of establishing the liability of people who sold investments for Stanford,” Baton Rouge attorney Phillip W. Preis said. More in The Advocate [...] Three years ago, on May 6, 2010, U.S. capital markets experienced the “flash crash,” when the Dow Jones Industrial Average suffered a stunning 1,000-point loss (9%) in five minutes, followed by an equally dramatic recovery. It could happen again. Moments before the 2010 flash crash, individual stocks were trading at a greater than 90% discount to the price. Accenture PLC, for example, was quoted at $39 just prior to the flash crash, then had trades clear at $32.62, then $5.34, $4.04 and $1.84 before recovering to close at $41.09. The point decline in the Dow within a single day was the largest since the Dow debuted in 1896. More in Forbes [...] SPOTLIGHT ON LEGISLATION: Behind-the-scenes meetings in DC with both Madoff and Stanford victims seeing strong support for SIPC legislation MESSAGE FROM THE NIAP PRESIDENT Dear NIAP Member, Greetings. We shortly expect SIPC action to begin in Congress. Certainly many victims have heard this sort of thing before, and Congress and uncertainty seem to go hand in hand, but the key elements are now in place for legislation to begin its march. With the House Financial Services Committee currently absorbed with the introduction [...] Five former employees of Bernard Madoff, scheduled to go on trial in October for allegedly helping the convicted con man carry off the largest Ponzi scheme in U.S. history, are seeking a two-month postponement. U.S. District Judge Laura Taylor Swain in Manhattan set an Oct. 7 trial date for the fraud case against Daniel Bonventre, Annette Bongiorno, Joann Crupi, Jerome O’Hara and George Perez. The defendants, who have all pleaded not guilty, are charged with crimes including conspiracy, fraud and falsifying records. Perez’s lawyer, Larry Krantz, said in a letter today that a revised indictment filed by the government on July 29 “contains a wholesale re-writing” of the previous one and includes additional allegations. Krantz said he was making the request on behalf of all five defendants. More on Bloomberg [...] Irving Picard, the court-appointed trustee handling the bankruptcy of Bernard Madoff’s firm, made his latest legal attack against New York Attorney General Eric Schneiderman Wednesday in a battle over a $410 million settlement for victims. Mr. Picard is attempting to block the settlement, one of the largest pots of money recovered for victims. It was reached last summer between Mr. Schneiderman and J. Ezra Merkin, an investment adviser who acted as a feeder to Mr. Madoff. Mr. Picard has argued that the attorney general had no authority to make such a deal in the first place. In a court filing Wednesday, lawyers for Mr. Picard accused the attorney general of giving “special treatment” to Mr. Merkin’s investors “to the detriment of all other customers.” More in the Wall Street Journal [...] E*Trade Financial Corp. (ETFC) shares fell, heading for the biggest drop since April, as the online brokerage said regulators were looking into how two of its units routed orders. E*Trade slid 3.8 percent to $14.56 at 10:54 a.m. New York time. The Financial Industry Regulatory Authority told E*Trade on July 11 that it is examining the order routing practices of E*Trade Securities LLC and G1 Execution Services LLC, according to the company’s quarterly report filed yesterday. The company said on July 24 that it plans to sell G1 Execution, months after disclosing that it had found “shortcomings” in how it measured whether trades were struck at the best prices. In yesterday’s filing, E*Trade said it last year completed a review of order handling practices and pricing for trades between E*Trade Securities and G1 Execution, also known as G1X. More on Bloomberg [...] Former Federal Bureau of Investigation Director Louis J. Freeh wants a $1 million fee for success securing creditor recoveries in the bankruptcy wind-down of MF Global Holdings Ltd., the failed commodities firm led by former New Jersey Gov. Jon S. Corzine. In a filing Monday with U.S. Bankruptcy Court in Manhattan, lawyers for Mr. Freeh said he brought “instant credibility” when he was assigned to serve as the firm’s Chapter 11 trustee in Nov. 2011, shortly after the firm collapsed under the weight of its large bets on European debt. Mr. Freeh’s lawyers asked for the $1 million in addition to the more than $20 million billed by Mr. Freeh and his legal teams for their hourly work on the case. Mr. Freeh’s hourly rate is $900. More in the Wall Street Journal [...] |
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