Dutch finance firms lost EUR 2 bln to Madoff: minister

28th May 2009, Comments 0 comments

Madoff’s illegal pyramid scheme is believed to have cost Dutch financial institutions EUR 1.9 billion, says Bos.

The Hague – The fraud scam run by New York trader Bernard Madoff had cost Dutch financial institutions nearly EUR 2 billion, the Netherlands finance minister said on Wednesday.

In a letter to the lower house of parliament, Wouter Bos said banking institutions had a joint exposure of at least EUR 1.5 billion, of which Fortis Bank Netherlands had EUR 922 million.

Figures shown by the ministry of finance reveal Dutch pension funds lost about EUR 166 million due to investments in Madoff's fraudulent firm in the United States.

Research conducted by the Dutch public service broadcaster NOS indicates the PME and PMT pension fund companies have lost money in the fraud. They serve workers in the metal, electrical and technical sectors, but say their reserves will not be substantially affected.

Royal Dutch Shell's pension fund has also been hit through investments with Madoff.

Private investors reported losses of some EUR 200 million while insurers lost about EUR 1 million.

"The exact number of investors who suffered losses from the Madoff fraud is unknown, but it is more than a thousand," said Bos.

Madoff, a 71-year-old Wall Street veteran arrested in December, has pleaded guilty to defrauding investors of billions of dollars in a giant pyramid scheme that collapsed in the global financial crisis.

He will be sentenced on 29 June and faces a prison term of up to 150 years.

AFP / Radio Netherlands / Expatica

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