Conn. Firm Collected $500M From Madoff's Marks

Hedge funds that sold access to Ponzi scheme face collapse

(NEWSER) - Last week Walter Noel was a successful hedge fund manager, with houses from Connecticut to the Caribbean and an adulatory photo shoot in Vanity Fair. But overnight, when Bernie Madoff's giant Ponzi scheme was exposed, his $14.1 billion firm, Fairfield Greenwich Group, lost more than half its assets. While the hedge fund capital of Greenwich has expressed sympathy for Noel, Madoff's biggest known loser—others question his firm's failure to perform due diligence on Madoff's suspiciously steady returns. More»

Mass. complaint vs. Fairfield Greenwich is regulatory, not criminal

(NEWSER) - Massachusetts regulators charged Fairfield Greenwich Group with fraud today, the Wall Street Journal reports, saying it failed in its fiduciary duties by funneling money into Bernard Madoff’s Ponzi scheme. Fairfield was one of Madoff’s top feeder funds, and there was a “profound disparity between the due diligence that Fairfield represented to its investors…and the due diligence it actually conducted,” said the Secretary of the Commonwealth. More»

(NEWSER) - Bernard Madoff’s alleged mega-fraud and the large number of Jewish investors he apparently snookered is stoking anti-Semitic feeling in tony Palm Beach, ABC News reports. “It is a terrible thing to say, but some of the WASPs are delighted, they take great pleasure in this,” said an author who has written critically about the socially stratified Florida enclave. More»

Funds were businessman's first Madoff deal

(NEWSER) - A New York businessman is suing to recover $10 million he handed over to Bernard Madoff 6 days before the alleged Ponzi schemer was arrested, the Wall Street Journal reports. Martin Rosenman wired the funds to a JP Morgan Chase account controlled by Madoff, who told the first-time investor that he would hold the money until next year. While Rosenman is one of many hoping to recover funds, his lawyer says time may be on the Bronx fuel company chief's side. More»

(NEWSER) - Government investigators are turning their eye to the middlemen who led clients into Bernard Madoff's long-running Ponzi scheme. The Wall Street Journal profiles five of them:

• Robert Jaffe: A dashing Florida philanthropist, he funneled tony clients to ex-boss Madoff. Jaffe says he is a "victim of these tragic events."
• Stanley Chais: His exclusive fund, "The Arbitrage," was secretly a pipeline to Madoff. Chais' family foundation is "wiped out" by the scandal, its director said.