Standard Chartered and Bernie Madoff
A class action lawsuit was filed yesterday in Miami on behalf of investors in Standard Chartered Bank International and Standard Chartered Private Bank. The suit seeks to recover millions of dollars in customer fees improperly charged by Standard Chartered.
According to the case filings, Standard Chartered purchased shares in a Fairfield Sentry Hedge Fund, one of the infamous Madoff feeder funds, on behalf of certain clients. Standard Chartered customers were charged fees based on the net asset value of their accounts with the Sentry Fund.
Since the Sentry Fund was essentially worthless after Bernie Madoff was exposed, fees paid by Standard Chartered customers, through investments in the Sentry Fund, were based on fraudulent asset valuations. According to the suit, the Plaintiffs are seeking to recover more than $5 million from Standard Chartered, which has since conceded that it was not entitled to charge these so-called “phantom fees”.
Recovering these “phantom fees” is clearly an important first step. But presumably in exchange for those fees, Standard Charter was in an advisory role, and responsible for due-diligence.
Zamansky & Associates is investigating potential wrongdoing related to internal controls, due diligence breakdowns and negligence which may have occurred.
If you are interested in discussing potential losses or have additional information regarding this investigation contact Zamansky & Associates.
Jacob ("Jake") H. Zamansky is one of the country’s foremost authorities on securities arbitration law, the legal recourse for investors claiming broker wrongdoing, or for brokers claiming wrongful termination or other misconduct by their employer. Zamansky & Associates, the New York-based law firm he founded, represents both individuals and institutions in complex securities, hedge fund, and employment arbitrations.
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