Wealth Manager - the site for professional investment managers

Register for full access to Citywire’s Fund Manager database, news and analysis. Registration is free and only takes a minute.

HSBC agrees $62 million Madoff settlement

HSBC has become the first custodian bank to settle in the class action law suit linked to Bernard Madoff, by agreeing to pay out $62 million (£38 million) to out-of-pocket investors.

The settlement with Irish-domiciled Thema fund investors is worth an estimated 20 cents on the dollar for the vehicle's $312 million in accrued real losses, reports claimed. HSBC acted as custodian for the fund, however the bank did not admit liability for investors' eventual losses.

The settlement reflects only a tiny portion of HSBC's exposure in connection with Madoff, who in 2008 admitted the entire wealth management arm of his business, Bernard L Madoff Investment Securities, had been an elaborate Ponzi scheme.

By the time of Madoff's arrest in December 2008, HSBC had become custodian or administrator to a number of funds linked to the former Wall Street investor.  These had accrued real losses of around $4.3 billion (£2.62 million). 

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play Investment Pulse: the highs and lows of 2014

Investment Pulse: the highs and lows of 2014

This week's Investment Pulse looks back at some of the biggest stories of the year as well as looking forward to 2015.

Play Inside ETFs: Why the US bull-run still has legs

Inside ETFs: Why the US bull-run still has legs

Global equities suffered a sharp sell-off in the third quarter but exchange traded fund investors are continuing to back the US to outperform in 2015

Play Paul Niven: I won't rip up the Foreign & Colonial Trust history book

Paul Niven: I won't rip up the Foreign & Colonial Trust history book

The newly appointed manager of the Foreign & Colonial trust talks about his plans for UK's oldest investment company.

Your Business: Cover Star Club

Manchester wealth firm hires Coutts director for London launch

Manchester wealth firm hires Coutts director for London launch

Former Coutts director Tony Robinson has joined Chartered Wealth Management to head the company’s newly opened London office.

Wealth Manager on Twitter