Swiss bank UBP says WSJ misinterpreted Madoff email

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Swiss bank UBP says WSJ misinterpreted Madoff email
Wed Jan 14, 2009 9:24pm GMT Email | Print | Share| Single Page[-] Text [+]
ZURICH (Reuters) - Swiss bank Union Bancaire Privee (UBP) said it conducted repeated analyses of the hundreds of millions of dollars it invested with disgraced financier Bernard Madoff but did not uncover any fraud, contrary to an earlier Wall Street Journal report.

The Journal, citing people familiar with the matter, had reported that the Swiss bank's own research team raised concerns about Madoff, who is charged with running a huge investment scam, as early as the early part of 2007.

But UBP, in a statement to Reuters, said the Journal had misinterpreted an internal email. The bank said it conducted "specific ongoing due diligence to consider and satisfy the concerns raised" by the internal email.

The bank added it had conducted repeated due diligence visits over the years and, like other investors, had no inkling that it and its investors had become victims of a fraud.

"This email was taken completely out of context and shows very clearly that at no moment whatsoever did anyone at UBP believe that Mr. Madoff could possibly be perpetrating a fraud," the statement said.

A Wall Street Journal spokeswoman had no immediate comment.

The Financial Times reported in December that UBP had a $700 million exposure to Madoff-related investments.

In an email exchange seen by the Wall Street Journal, UBP's then-deputy head of research, Gideon Nieuwoudt listed a number of worries, including the lack of even basic information.

He recommended in the email that Madoff be taken off UBP's list of approved funds.
At least two members of UBP's executive committee participated in the email discussion, the Journal said.

(Reporting by Sven Egenter; additional reporting by Gina Keating in Los Angeles; editing by John Stonestreet, Leslie Gevirtz)




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