Fairfield Sentry Limited
Practice Area: Securities FraudCase Background
On March 11, 2009 a lawsuit was filed in the United States District Court for the Southern District of New York on behalf of individuals who acquired the shares of Fairfield Sentry Limited (the “Fund”) between March 11, 2004 and December 10, 2008 (the “Class”).
This case arises from a massive, fraudulent scheme perpetrated by Bernard L. Madoff (“Madoff”) through his investment firm, Bernard L. Madoff Investment Securities, LLC (“BMIS”), and others, and which was facilitated by other named Defendants.
The Complaint alleges that during the Class Period, Defendants issued to the investing public false and misleading financial statements and press releases concerning, among other things, the Fund’s reported net asset value, the manner in which the Fund’s assets were invested, the extent of the Defendants’ due diligence of Madoff and BMIS, and the true state of supervision and oversight over the Fund’s assets.
Defendants caused and permitted $7.5 billion of the Fund’s total assets to be handed over to Madoff to be “invested” for the benefit of the Class. Class members’ investments with the Fund were decimated as a direct result of the fraud perpetrated by Madoff and BMIS and the complete failure of the Fairfield Defendants to properly discharge their fiduciary duties despite the existence of a myriad of “red flags” indicating a high risk to Fairfield Sentry from concentrating its investment exposure in Madoff.
On December 10, 2008, Madoff informed certain senior BMIS employees that BMIS’ investment advisory business was an utter fraud. Madoff also stated that he estimated the losses from this fraud to be approximately $50 billion. On December 11, 2008, SEC and criminal charges were brought against Bernard Madoff.
One of Madoff’s clients was Defendant Fairfield Sentry Limited, which, unknown to Class members, and notwithstanding assertions to the contrary, failed to monitor or supervise the investments made with Madoff and BMIS, and failed to perform adequate due diligence. Investors who entrusted their savings are now ruined. Indeed, scores of charities were destroyed and have either closed their doors or cancelled their proposed grants.
Case News
On September 29, 2009, Plaintiffs filed the Second Consolidated Amended Complaint on behalf of shareholders and/or equity holders of four Fairfield Greenwich Group/Madoff feeder funds. These funds include: Fairfield Sentry Limited, Fairfield Sigma Limited, Greenwich Sentry, L.P., and Greenwich Sentry Partners, L.P.
On December 22, 2009, Defendants filed motions to dismiss the Second Consolidated Amended Complaint. On August 18, 2010, the Court entered a decision and order denying in part and granting in part the motions to dismiss filed by Defendants.
The parties are currently engaged in discovery and a motion for class certification is being briefed.
Cohen Milstein Sellers & Toll PLLC has significant experience in prosecuting investor class actions and actions involving securities fraud. The firm’s reputation for excellence has been recognized on repeated occasions by courts which have appointed the firm to lead positions in complex multi-district or consolidated litigation. Cohen Milstein Sellers & Toll PLLC has taken a lead role in numerous important cases on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total in the billions of dollars. For more information about the firm, please go to www.cohenmilstein.com.
If you have any questions about the action, or with regard to your rights, please contact either of the following:
Steven J. Toll, Esq.
Tyler Gaffney
Cohen Milstein
1100 New York Avenue, N.W.
West Tower, Suite 500
Washington, D.C. 20005
Telephone: (888) 240-0775 or (202) 408-4600
Email: stoll@cohenmilstein.com or tgaffney@cohenmilstein.com