Business | Banking
UK probing bank chief's role in scam
UK investigators are probing the head of an Austrian bank that funnelled billions of dollars into Bernard Madoff's Ponzi investment scheme, the Financial Times has learnt.
- By Michael Peel and Eric Frey, Financial Times
- Published: 22:51 June 30, 2009
London/Vienna: UK investigators are probing the head of an Austrian bank that funnelled billions of dollars into Bernard Madoff's Ponzi investment scheme, the Financial Times has learnt.
Sonja Kohn, president and majority shareholder of Bank Medici, is suspected of charging the London outpost of the Madoff empire millions of pounds for worthless research, said people familiar with the matter.
The allegation - denied by Kohn's lawyer - highlights the expanding international investigations triggered by shockwaves from what has been billed the world's biggest fraud.
The claims are part of a request for legal assistance sent to Austrian prosecutors in March by the UK's Serious Fraud Office "in connection with fraudulent activities of Bernard Madoff", the people said.
Among the claims is that London-based Madoff Securities International paid Kohn £7 million (Dh42.6 billion) from 2002 to 2007 for reports that MSIL workers say were useless.
Andreas Theiss, a lawyer for Bank Medici who speaks for Kohn, denied she had received any money from MSIL or from Madoff directly.
He said she was co-operating with investigations by the US Department of Justice, and there was nothing to suggest she had any involvement with the tycoon's $65 billion fraud.
Theiss said: "There is no evidence whatever - nothing, nothing, nothing." The SFO declined to comment.
Bank Medici, which invested most of its $3.2 billion in the Madoff empire and ran investor "feeder" funds in Luxembourg and Ireland, is one of the most spectacular casualties of the disgraced tycoon's scheme.
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