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* Lawyer says investors may ask feeders to refund fees
* Says some feeders may have passed on fees to advisors
* SFO investigates London-based FIM Advisors
* Kingate feeders made millions in fees and commissions
By Martin de Sa'Pinto
ZURICH, April 9 (Reuters) - Investors who lost money in the Bernard Madoff fraud by investing via feeder funds are likely to demand a fees refund, but locating what may total hundreds of millions of dollars in fees may be a complex matter, a lawyer for some of the investors said on Thursday.
Geneva-based lawyer Franco Foglia is advising clients who lost money in investments channelled through London-based consultant FIM Advisors to two Madoff feeder funds run by Kingate Management Ltd of Bermuda.
UK law enforcers are probing the role of FIM in the Kingate funds. FIM also advises on $2 billion of assets invested in other funds, some of which had limited exposure to Kingate.
Madoff pleaded guilty last month to orchestrating Wall Street's biggest-ever fraud, a Ponzi scheme that involved as much as $65 billion in funds over 20 years.
Foglia said that, in almost 14 years of existence, Kingate may have collected more than $300 million in fees, but that much of this may have passed through FIM, which advised Foglia's clients on their Kingate investments.
Foglia's estimate includes front loads, or introduction commissions paid to distributors, and other charges, management and performance fees, he told Reuters in a telephone interview. November factsheets for both the Kingate funds show they charged an annual management fee of 1.5 percent.
"Some of the largest feeders made several tens or even hundreds of millions over the life of these investments, but many of them may not have done the job they were paid to do," Foglia said.
"Expenses such as annual management or performance fees that investors paid to Madoff-related funds constitute part of the loss suffered by those investors. Many investors are likely to seek a ruling for the disgorgement of those fees."
Britain's Serious Fraud Office is investigating FIM about its alleged involvement in the Madoff scandal, a source close to a law enforcement agency told Reuters. It has been reported that the SFO is looking at the role of feeder funds more broadly.
Kingate lost $2.7 billion in its Kingate Global Fund and 616 million euros ($833.6 million) in Kingate Euro, both domiciled in the British Virgin Islands (BVI), both invested almost entirely in Madoff-related entities.
In a document released earlier this year, FIM played down its links to Kingate and said it had never been investment adviser or investment manager to the Kingate Funds.
FIM said it had a non-exclusive deal with Kingate to sell its funds, and that it lost about $145 million via investments by its funds of hedge funds in Kingate funds. It also said it received fees from Kingate for administrative services.
Sources with knowledge of the situation say the association between Kingate and FIM was a strong one.
FIM is the only consultant named in Kingate fund fact sheets and offering documents, said Foglia. Federico Ceretti and Carlo Grosso, FIM founders and respectively chief executive and executive chairman of Kingate, are specifically named.
Others say FIM and Kingate were almost synonymous.
"FIM's founders Federico Ceretti and Carlo Grosso (chief executive and executive chairman of FIM respectively) were Kingate, and everyone knew it," said one investment professional who met both men several times and who asked not to be named.
Also, a person very close to Kingate confirmed Grosso and Ceretti were present at the founding of Kingate.
Representatives of Ceretti and Grosso did not reply to requests for more information.
"It will be harder to compel a Bermuda-based manager or a British Virgin Islands fund to disgorge fees than a London or New York firm that brought investors to Madoff via these feeders," Foglia said.
The location of the assets investors are looking to recover is also important, said Noel Campbell, commercial litigation partner at London law firm Holman Fenwick Willan.
"If you are an investor you need to see where you are most likely to get recovery," said Campbell in a telephone interview.
When contacted at Kingate's Bermuda offices, Christopher Weatherhill, president and director of Kingate Management and a director of the Global and Euro funds, declined to discuss who had received fees paid by Kingate investors. (Additional reporting by Laurence Fletcher; Editing by Andrew Macdonald) ($1=.7389 Euro)