ETF News

Big Madoff loser eyes legal move on PwC- FT

Dec 18 (Reuters) - Fairfield Greenwich Group, the fund whose clients stand to lose $7.5 billion in Bernard Madoff’s alleged $50 billion Ponzi scheme, is considering suing its accountants, PricewaterhouseCoopers (PwC), for failing to detect the fraud, the Financial Times reported on its website.

The fund, which is currently the biggest known loser in the Madoff scandal through its investments in Bernard L Madoff Investment Securities, is considering the move after an auditor was named in a case brought by another victim, the paper said.

PwC and Fairfield could not be immediately reached for comment by Reuters.

The New York Law School on Tuesday sued investment firm Ascot Partners LP, its general partner J. Ezra Merkin and auditor BDO Seidman LLP over investments with Bernard Madoff.

Merkin’s lawyer Andrew Levander said in a statement that Merkin and his family were among the largest victims of the alleged fraud.

BDO Seidman said its audits of Ascot Partners “conformed to all professional standards and we will vigorously defend ourselves against these unfounded allegations.”

The small auditing firm Madoff used, Friehling & Horowitz in a suburb of New York City, is under investigation by the District Attorney in Rockland County for potential violations of New York state law.

A federal judge on Wednesday ordered Madoff, 70, confined to his $7 million Manhattan apartment and told Madoff’s wife, Ruth, to surrender her U.S. passport by noon on Thursday as part of modified bail conditions.

Reporting by Ajay Kamalakaran in Bangalore; Editing by Richard Hubbard