Monday, December 22, 2008

It was good while it lasted

In what looked like the perfect way to make money, the partners of Fairfield Greenwich Group made a ton of money by steering money to Bernie Madoff and taking a healthy piece of the action for their financial skilz.
Clients of Fairfield, a secretive hedge fund advisory company based in Connecticut, lost $7.3 billion to Mr. Madoff’s fund. But for Fairfield, working with Mr. Madoff was hugely profitable.

Internal documents from Fairfield show that the firm has taken more than $500 million in fees since 2003 alone from the money it placed with Mr. Madoff. Nearly all those fees went to a handful of Fairfield executives, including Walter M. Noel, Fairfield’s founder, who used the money to build a glamorous life, splitting his time between homes in New York, Connecticut, Florida and the Caribbean.
Sell people on the deal, make a few promises that you don't keep and let Bernie keep cranking out his fantastic returns. What could possibly go wrong?

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