Ogier Discusses Potential Causes and Courses of Action Available to Investors in Madoff “Feeder Funds” Organized in the British Virgin Islands

On December 11, 2008, having admitted to masterminding what would appear to have been a $50 billion Ponzi scheme through his brokerage firm, Bernard L Madoff Investment Securities LLC (BMIS),  Bernard Madoff was arrested and charged with securities fraud.  On December 15, 2008, the Securities Investor Protection Corporation commenced liquidation proceedings against BMIS and a Bankruptcy Trustee was appointed over it.  Concerned that they are very unlikely to make any significant recoveries out of the liquidation of BMIS, investors in the Madoff “feeder funds” are now looking at possible ways of recovering their losses from the feeder funds and their third party service providers such as their administrators, custodians and investment managers.  In an exclusive contributed article, Robert Foote, Managing Associate and Barrister in the British Virgin Islands (BVI) office of leading offshore law firm Ogier, explores some of the causes and courses of action that might be open to such investors under BVI law.  The discussion has particular relevance for investors in Madoff feeder funds organized as BVI entities.

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