West Palm Beach (HedgeCo.net) - Bernstein Liebhard is investigating whether, among other things, these investment funds conducted proper due diligence before investing heavily in Madoff Securities, and whether these funds ignored the warning signs that Madoff was conducting a large-scale fraud.

Bernstein Liebhard is also investigating whether these funds misrepresented to investors the concentration of the funds’ investments in Madoff Securities. On December 11, 2008, Madoff was arrested by federal authorities who say Madoff admitted to operating a $50 billion Ponzi scheme in which Madoff used the principal investments of new clients to pay fictitious "returns" to other clients.

The criminal action against Madoff is pending in the Southern District of New York, 08-Mag-2735. Although Madoff had only a few individual clients that invested directly with him, individuals and institutions across the world invested indirectly and sometimes unknowingly in Madoff’s scheme through "feeder funds" – such as Fairfield Sentry Ltd. (run by the Fairfield Greenwich Group), Rye Select Fund (run by Tremont Group Holdings), and Kingate Global Fund (run by FIM Advisers LLP) – whose sole purpose was to funnel money to Madoff Securities.

Hedge funds and funds of funds invested heavily with Madoff’s feeder funds (including Fairfield) despite many warning signs that the consistent returns Madoff delivered were too good to be true. "

Hedge fund, fund of funds managers, or other collective investment fund that lost money as a result of its investment in Madoff Securities, may have a right of action to recoup losses," Bernstein Liebhard says "We has assembled a team of former government prosecutors, former SEC trial attorneys, and investigators to analyze the various legal claims available to investors injured by the Madoff scheme."

Bernstein Liebhard is one of the preeminent plaintiffs’ class action law firms in the country, having pursued hundreds of securities and consumer cases and recovering approximately $2 billion for its clients. It has been named to The National Law Journal’s "Plaintiffs’ Hot List" in each of the last six years.

Editing by Alex Akesson

Tags: accredited-investors, boston, january-1st, pioneer-press, prison-term, risk-management-processes, s-poll, shorting-stocks, time-difference, value-performance, volatility

Reuters – Hedge fund managers are facing D-day as investors demand back billions of dollars from ailing and healthy funds alike.

Funds managers around the world said they are sitting on record levels of cash to meet an expected flood of "I want my money back" notices on Sept. 30 — the end of another month of horrible industry performance and the deadline for most funds offering monthly and quarterly redemptions.

"This is not like flicking a light switch," said Timothy Mungovan, a partner who advises hedge funds at law firm Nixon Peabody LLP. "It is more like a bowling ball careening down an alley where we don’t know if it will go down the gutter or be a strike and take out several big funds."

The issue goes beyond well-paid hedge fund managers losing lucrative asset management fees: Global markets could be jolted if hedge funds are forced to dump stocks, bonds and other securities to meet redemptions.

Even industry stars such as Kenneth Griffin of Citadel Investment Group are nursing losses and the average hedge fund is down roughly 10 percent so far this year — the worst performance in more than a decade.

Read Complete Article

Tags: brevan-howard, citadel-investment-group, coffers, fame, housing-market, investment-arm, levies, mayhem, s-poll, settlement-system, volatility