The state of Connecticut is suing a bank and a money manager who placed investors’ funds with fraudulent financier Bernard Madoff. The suit seeks to recover $16 million in fees for those who lost their investments. WNPR’s Harriet Jones reports.
The state has been pursuing a months-long investigation into Westport National Bank and a Wilton-based money manager, Robert Silverman, over their connections to Madoff’s multi-billion dollar Ponzi scheme. The bank set up two funds for investors’ cash, promising to act as custodian, but then allowed Silverman’s company, PSCC, to place the cash with Madoff. Attorney General Richard Blumenthal says they both ignored warning signs about Madoff’s fund.
"The bank and the money manager in effect aided and abetted Madoff’s massive fraud by ignoring and concealing clear and compelling signals that his investments were bogus. There were screaming signs and sirens shouting fraud, that the bank and the money manager repeatedly and reprehensibly disregarded."
240 investors were affected, 97 of them in Connecticut. The suit says Silverman and Westport National so inflated their fees, that even Madoff himself questioned the amount. The two are also accused of acting as investment advisers without a state license.
For WNPR, I'm Harriet Jones.