A group of investors claiming losses due to Bernard Madoff’s massive Ponzi scheme years ago is nearing a settlement with Connecticut Community Bank over the bank’s alleged negligence in the scheme, the Wall Street Journal reports.
The investors said they lost $60 million, and sued the bank in three linked federal suits and a separate state suit. How much the investors could receive from the settlement wasn’t disclosed, but at least one plaintiff has decided not to settle.
The investors, who come from states including Florida, New York, and Texas, alleged that Connecticut Community Bank should have done more to verify whether Madoff actually made the earnings he claimed from his trades.
Since the investors weren't direct customers of Madoff, they couldn’t sue him and his securities firm directly. The bank invested about $60 million into Madoff firms.
Spokesmen for the bank and its owner, William Berkley, declined to comment to the Wall Street Journal. Lawyers for plaintiffs and defendants also declined to comment on a settlement.
Madoff is serving out a 150-year term in federal prison. Madoff admitted to his Ponzi scheme in 2008.
Nat Rudarakanchana covers commodities and companies for the International Business Times. He is especially interested in precious metals, the food and drink industry, and...