from Funds Hub:

Madoff Junkies

Bernard MadoffOne of the more striking aspects about the Madoff affair is the large number of people who appear to have been 'hooked' on Madoff products.


Money managers were drawn by Madoff's air of mystique, his stellar reputation as a market timer, the apparently steady returns with rock bottom volatility and the absence of fees, which some collected from clients anyway.


Those wanting more could simply have increased allocations but some chose to create new investment vehicles instead. Behind the banks and asset managers which lost money, some names appear again and again.


Take the circle of managers revolving around Sandra Manzke, founder of Tremont, whose Rye unit lost substantially all of its roughly $3 billion in assets.


Tremont and Bermuda-based Kingate Management also set up Kingate Global, a Madoff feeder which lost $2.7 billion, and Manzke was on the board of the fund, the Financial Times reported earlier this year.

from Funds Hub:

Shadow of Madoff

It's hard enough for fund firms to get investors to put money into markets when stocks are so volatile, but it seems they're also still having to wrestle with the bad publicity from U.S. financier Bernard Madoff's giant fraud.

rtr23ea9Ashraf Mohamed, portfolio manager and head of Islamic funds at investment firm Stanlib in South Africa, told the London leg of the Reuters Islamic Banking and Finance Summit that investors are still nervous of another Madoff.

"All they are doing right now is saying we want to make sure there isn't any risk. One comment is 'let's make sure we don't have another Bernie Madoff situation'," Mohamed said.