Advertisement ::

Enlarge Cartoon

Geneva, Switzerland (GenevaLunch) – Manuel Echeverría, the head of Optimal in Geneva, faces criminal charges for his role in the Madoff ponzi scheme. Optimal is Spanish bank Santander’s hedge fund arm, based in Geneva. Echeverria, who left the company some months ago after 19 years, according to the Wall Street Journal, becomes “one of the first and most senior wealth managers known to be facing criminal charges in connection with the Madoff scandal”, according to the Financial Times (FT). The newspaper, which has seen court documents, says the charges were filed in August but have just become known now, with Echeverría losing a legal bid to disqualify asset manager Franck Berlamont in the case. Five Aurelia asset managers are implicated in the case, says the FT. The company lost $800 million of its clients’ money to Madoff, Reuters reported in April 2009.

Santander has said its clients lost some $3.5 billion through Optimal’s link to Madoff but that the vast majority of its affected private clients have accepted its offer of Santander shares as repayment. “Institutional investors such as Geneva Partners aren’t eligible for the compensation deal”, reports Dow Jones.

The charges against Optimal’s former senior manager stem from investigations earlier in 2009 in Geneva into the accuracy of the company’s declarations that due diligence was applied before handing over money to Madoff. Bloomberg notes that “There is no suggestion that Echeverria was involved in Madoff’s fraud, according to the court ruling.”

Links to other sites: Bloomberg, Dow Jones, Financial Times, Santander