Spanish prosecutors are investigating Banco Santander SA’s loss of €2.3 billion ($3.1 billion) for clients by investing with Bernard Madoff. Prosecutors are specifically looking into the details of Santander’s relationship with Madoff’s firm and when Santander knew about problems related to it, the WSJ reports today.
Santander was among the most active of the Madoff “feeder funds” and brought wealthy Latin American and European client to Madoff. The WSJ reports that Santander’s clients’ losses from Madoff investments are by far the largest reported at any single bank, well beyond the next highest loss by HSBC Holdings PLC which is said to have $1 billion of exposure.
Spanish investigators said they want to know why Santander Chairman Emilio Botín sent one of his top executives to see Madoff in New York just weeks before the scheme collapsed. Investigators also want to know whether managers at Santander’s Swiss-based hedge-fund unit, Optimal Investment Services SA, Optimal knew of any problems at Madoff’s operations when it marketed his funds to investors.
well, its obvious why Santender sent top executive to see Bernie, Santender obviously tried to “cash in” but obviously Bernie was having problems at that point, I am always amazed at the stock market, even though Bernie was giving 12 percent profits, his clients were starting to “pull out money”