Funds Hub

Money managers under the microscope

Made to sweat on Madoff

February 11, 2009

Appearing before a Treasury Select Committee can’t be enjoyable at the best of times.

rtr232shBut when your clients may have lost around 2.3 billion euros in Bernard Madoff’s alleged fraud, it must be positively painful.

“Your due diligence was absolutely and utterly duff,” Committee Chairman John McFall told Abbey chief executive and Santander executive vice president Antonio Horta-Osorio. “When you’re investing other people’s money you should have adequate due diligence.”

McFall added to Santander’s pain by telling the world he had watched evidence from Harry Markopolos, the man who had tried to blow the whistle on Madoff, on YouTube.

Markopolos, he said, had taken five minutes to spot Madoff, in part because his investment returns were “a 45 degree” angle.

Horta-Osorio defended Santander’s due diligence processes and repeated that the bank had offered to compensate clients, but, as has often been the case in these hearings, few of the MPs looked that convinced.

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •