You Wont Read This About Greenwich Resident Walter "Feeder Fund" Noel At The Greenwich Time .....Brian Ross At ABC News Shows Failed Greenwich Time Editor Bruce Hunter How To Cover The Breaking Greenwich News Story About The Fairfield Greenwich Group
IT'S JUST LIKE BEING THERE:
Listen In As Ponzie Schemers Run Their Big Fat Hedge Fund Mouths On The Phone.....
Madoff: "Obviously, first of all, this conversation never took place, Mark, OK?"
Amit Vijaygergiya (Fairfield's Chief Risk Officer): "Yes, of course."
Later in the call, according to the court filing, Madoff counsels Vijaygergiya on how to have a discussion with the SEC, "the less you know about how we execute ... the better you are ... your position is, 'listen, Madoff has been in business for 45 years ... a well known broker. We make the assumption that he's doing everything properly.'"
THE BLOTTER FROM BRIAN ROSS AND THE INVESTIGATIVE TEAM: A Chilling Glimpse Inside a Madoff Feeder Fund
The clearest look to date of the relationship between Bernard Madoff and his feeder funds, one of which netted hundreds of millions in fees and which authorities say exposed investors to undisclosed risks, is put forth in new court documents filed by the Massachusetts Secretary of State, William Galvin.
One potentially damning accusation made by Galvin was that principals at the Fairfield Greenwich Group discussed among themselves the risk that Madoff would "blow up" and was aware of the gaps in its knowledge of Madoff's operation.
However, Galvin alleges Fairfield did not disclose those concerns to investors. Fairfield Greenwich, founded by Walter Noel, has been accused of fraud by Galvin who says the firm knowingly misrepresented to its investors what it knew about Madoff's operation and asserted it performed a level of due diligence that it did not actually perform.
The court papers detail a December 2005 telephone conversation that allegedly took place between Fairfield executives and Madoff in which Madoff counsels them on how to manage their conversation with the regulators when it comes to describing what they know about Madoff's operation.......
..... The court papers also cite an internal Fairfield e-mail between a fund manager in the U.S. and one in the U.K. as evidence that Fairfield, at a time when it should have been offering to repay performance fees, instead was continuing "the ruse that they had actually been doing due diligence."
"You mentioned that Fairfield used to get copies of some trades done by Madoff," the e-mail from Manuel Gomez of Fairfield Sigma to a colleague allegedly began. "In order to cover my ass, can I get some copies of those trades. I need to show people who invested in Sigma that I was doing due diligence in what is the largest scam in financial history." .....
....According to the civil complaint, the SEC relied on Fairfield's representations in determining Madoff's operation was not fraudulent. The court papers state that based on the conversation, Fairfield had to know Madoff was manipulating the SEC regulators.
It also suggested that Fairfield disclosed proprietary investor information to Madoff in an effort to "curry favor." Fairfield "repeatedly gave him proprietary information," the complaint states.....
.....The filing cites a September 2005 e-mail sent from a client to Fairfield in which the clients asks about the "small accounting firm" used by Madoff investments. "Is that accounting firm checked and approved by Fairfield Greenwich Group?" the client asked.
Fairfield Greenwich knew that Madoff's accounting firm "only had one employee," according to the filing, but the Fairfield's CFO Dan Lipton replied that the firm was "small to medium-sized." "They have hundreds of clients and are well-respected in the local community," Lipton instructed someone at Fairfield to tell the client, according to the filing.....
....In November and December 2008, Madoff, apparently desperate for funds to shore up his scheme, reversed a long standing policy limiting the amount of money Fairfield could place under his management. And, the court papers state he 'reacted angrily" when he learned that a Fairfield investor sought to cash out significant amounts of assets under Madoff's management.
In response to his anger, Fairfield, instead of questioning his motive, the complaint asserts, redoubled its marketing efforts "to defend against redemptions" and allegedly began to rapidly set up a series of new funds in cooperation with Madoff....
....."In the words of Walter Noel, one of Fairfield's founders, 'we tried to help stem things,'" the court papers state. $14.8 million was raised for one of the new vehicles but "no offering documents for that fund ever existed." ....
....The court papers cite a letter from Fairfield's Jeff Tucker to Madoff dated December 10 -- the very day Madoff confessed his crimes to his sons and the same day his wife withdrew about $10 million from another Madoff vehicle, in which Fairfield noted, "We have taken a number of steps with our other funds in order to put all of our investible capital in Sentry and the new split strike strategy which we call Emerald."
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