Fund of Funds
What does a fund of funds do ?
Fairfield Greenwich Group promised its investors that money could not be moved from its accounts with Bernard L. Madoff Investment Securities without two signatures. It said that it would independently calculate the value of the funds it invested at Mr. Madoff's firm at least once a week. It promised to reconcile statements from individual trades with Mr. Madoff's custodial records.
As it raised money all over the world, Fairfield also made detailed pledges about how it would monitor and track Mr. Madoff's investments, the documents show. Now, investors and regulators are sure to ask whether Fairfield made good on those promises -- or whether it was a facilitator of the Madoff scandal as well as a victim.Similar questions may arise for the dozens of banks and hedge funds around the world that reaped extraordinary fees for steering investments to Mr. Madoff over the last decade. None of them, however, earned more from their Madoff business than Fairfield did during the firms' 20-year relationship.
BUSINESS
Firm Built on Madoff Ties Faces Tough Questions
By ALEX BERENSON and ERIC KONIGSBERG
Published: December 22, 2008
Fairfield Greenwich Group took over $500 million in fees from money it placed with Bernard L. Madoff's fund.