Monday, December 15, 2008

Due Diligence This Fund lost 1/2 of its $14 Billion


Fairfield Greenwich Group
As of November 1, 2008, assets under management at FGG totaled approximately $14.1 billion, of which approximately $7.5 billion was invested in vehicles connected to Bernard L. Madoff Investment Securities.

Partners:
* Walter Noel
* Jeffrey Tucker
* Andrés Piedrahita
* Richard Landsberger
* Lourdes Barreneche
* Cornelis Boele
* Matthew C. Brown
* Yanko Della Schiava
* Harold Greisman
* Jacqueline Harary
* Vianney d’Hendecourt
* David B. Horn
* Daniel Lipton
* Julia Luongo
* Mark McKeefry
* Charles Murphy
* Maria Teresa Pulido Mendoza
* Santiago Reyes
* Andrew Smith
* Philip Toub
* Amit Vijayvergiya

FGG’s due diligence process is deeper and broader than a typical Fund of Funds, resembling that of an asset management company acquiring another asset manager, rather than a passive investor entering a disposable investment.

FGG’s legal, compliance, and accounting teams specialize in investment management regulation, securities compliance, corporate operations, and tax issues. Hedge fund managers function within an ever more complex legal and regulatory landscape, and the role of this part of the diligence exam is to determine the seriousness of any deficiencies in this area which may cause risk of sanction, loss, or reputational embarrassment.

Both in-house and retained legal professionals interview the management and staff of the manager, research regulatory filings, and review corporate organizational documents, as well as fund memoranda and related material contracts.

addendum: After 10 hours of thinking about this, listening to all the discussions of Psychopathic behavior, etc, ad nauseum, more ad nauseum, I think Bernard Madoff cast a big net to catch big fish. Unfortunately, any nets catch the unintended little fish - the cost of doing business. I am very impressed (I don't care what you think) with his ability to keep this thing up in the air and off the ground (for years.) How he got around filings, registrations - How he must have sent statements to all the "fish" that kept their balances (that read their statements, that believed the statements - monied people) how he must have filed 1099B's and dividend distributions without raising an eyebrow - was pure genius - I am impressed - In the Hall of Fame of Great Performers - he will go down and be talked about for the next 50 Years. Bernie - see you at the next Kennedy Center for Performing Arts - WOW - way to go!!!

1 comment:

William Hone Jr. said...

Taking a more inward perspective on a man like Madoff, earlier generations of Americans would have called him a genius. In his Journal entry of March 2, 1842, Thoreau wrote:

Character is genius settled. It can maintain itself against the world, and if it relapses it repents. It is as a dog set to watch the property of Genius. Genius, strictly speaking, is not responsible, for it is not moral.