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Austria's Madoff-hit Bank Medici seeks buyers
March 12, 2009 / 9:56 AM / in 9 years

Austria's Madoff-hit Bank Medici seeks buyers

VIENNA (Reuters) - Austria’s Bank Medici, the bank that managed $3.2 billion worth of funds invested with Bernard Madoff’s alleged Ponzi scheme, is seeking buyers who might be interested in its banking license, its lawyers said.

In a briefing for reporters late on Wednesday, Medici’s lawyer Andreas Theiss said he considered the license to be the main attraction. Medici’s main fee income source vanished when Madoff was exposed last year.

“The main asset is a banking license in an affluent European Union member state,” Theiss said. “To be able to enter that market quickly, simply, is an asset.”

Theiss said he could not say what investors Medici was talking to and what their plans for the bank -- which has a small number of wealthy individuals as clients but mainly managed the Madoff-exposed funds -- would entail.

Medici was investment manager or distributor for the Herald Lux and Herald US fund, which had $2.1 billion under management before Madoff’s scheme collapsed, and of Thema International fund, which had $1.1 billion under management.

The bank, with 75 percent owned by Chairwoman Sonja Kohn and 25 percent by Italy’s UniCredit, is being sued by investors in Austria and in the United States.

Some of the lawsuits have alleged that Kohn was implicated in Madoff’s scheme or that she should have grown suspicious of his steady performance and should have warned investors.

Theiss dismissed both allegations, saying that Bank Medici and Kohn were victims and that Madoff had duped not only them but also sophisticated bankers and powerful regulators such as the U.S. Securities and Exchange Commission.

A spokeswoman for Bank Medici said Kohn did not want to talk to the media currently. She has previously said in statements to media including The Wall Street Journal that she was as shocked as everybody else by the revelation of Madoff’s scheme.

Theiss’s co-lawyer Clemens Trauttenberg said Madoff -- who acted as sub-custodian and broker for the Herald funds’ custodian HSBC -- gave accounts of his dealings every day he traded in securities for the funds.

“If he had actually bought everything he said he had bought, then his performance would really have been what he pretended it to have been,” Trauttenberg said.

Editing by Greg Mahlich

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