NEWS: Citco Group Agrees to Pay $125 Million in Settlement
On August 13, the Citco Group, a Madoff feeder fund administrator, agreed to pay a $125 million settlement. The hedge fund administrator was accused of wrongfully leading investors to invest with Fairfield Greenwich Group. The group is believed to be one of the largest feeder funds for Bernie Madoff.
Citco is comprised of independent company groups that handle hedge funds, private equity and real estate firms, and institutional banks. They currently operate in over 40 countries and, according to their website, are in charge of $125 billion in hedge fund assets under administration. According to the attorney who represents the investors, Citco Group is considered one of the largest administrators connected to the Madoff fraud.
The Citco Group was accused of allegedly not monitoring and fairly valuing the Fairfield Greenwich’s investments, where more than $7 billion in assets were sent to Bernard L. Madoff Investment Securities LLC. When Bernie Madoff’s Ponzi became known in December 2008, investors opened up and claimed they suffered major losses before Citco’s alleged deception and carelessness.
Citco denies the claims of wrongdoing, although they have reached a settlement where they will pay $125 million. Manhattan’s U.S. District Judge Victor Marrero must approve the settlement.
Bernie Madoff is the notorious investment advisor who scammed a large group of investors. He pled guilty and is currently serving a 150-year jail sentence. Richard Breeden, former US Securities and Exchange Commission chairperson, currently oversees a $4 billion fund set aside to repay the Madoff feeder fund investors.