Funds News

US law firm files Madoff class action in New York

MADRID, Feb 5 (Reuters) - A U.S. law firm has filed a class action in New York on behalf of investors in Optimal, an investment fund of Spain's Santander SAN.MC, affected by the alleged $50 billion fraud by U.S. financier Bernard Madoff.

Coughlin Stoia Geller Rudman & Robbins LLP, which recovered $7 billion for Enron victims, filed the lawsuit in the Southern District of New York alleging wrongful conduct in connection with the Ponzi scheme run by Madoff, court documents showed on Thursday.

Optimal Strategic U.S. Equity is an investment fund of the eurozone’s largest bank Santander, which in December announced client exposure of 2.33 billion euros ($3 billion) to Madoff.

Unlike other Madoff-related cases the suit does not contain a securities claim, meaning plaintiffs can receive relevant information about the case before any trial which could bring to light previously unknown details on the case.

Coughlin Stoia called an offer by Santander to partially compensate victims “woefully inadequate” and accused the bank of “attempting to coerce them into surrendering their legal claims for a small fraction of their losses”.

Santander has offered individuals who invested in Optimal a total of 1.38 billion euros in preference shares paying a 2 percent coupon and with a call after 10 years. [ID:nLS214943]

Spanish lawyers for Santander customers, Cremades & Calvo Sotelo, said earlier this week it would seek tailor-made solutions from the bank for affected clients. [ID:nL3323183] (Reporting by Tracy Rucinski; Editing by David Holmes)