Santander bank to compensate victimos of Madoff fraud
Santander clients affected by Madoff scandal will recover 100% of their initial investment
Santander bank has decided to face up to the damage that the fraud carried out by the wall street stock broker, Bernard Madoff, has done to its clients faith in the bank despite declarations by Emilio Botín to the contrary when the scandal first came to light.
Private clients affected by the fraud perpetrated by Madoff and which affected the bank’s ‘Optimal’ fund will get 100% of their initial investment back. However, no solution has been offered for institutional clients of the bank who have also lost large amounts.
The cost to the bank is expected to be around 500 million euros which is expected to be taken from the 2008 profits for Santander due to be announced on 5th February.
Compensation will be given via means of the emission of 1,300 euros in shares with an annual rate of return of 2% with the option of Santander buying them back alter 10 years.
According to a statement by Santander bank the group took the decision to make good the losses incurred by private investors due to exceptional circumstances and also for commercial reasons so that the bank could maintain its business relations with these clients.
A spokesperson for the bank said that ‘the sale of these products has always been transparent’ due to the number of supervisory bodies in the US such as the SEC which did not detect anything despite the fact that Madoff securities was regularly inspected in recent years.
The compensation package for private clients of Santander bank was announced on Monday this week at a meeting of Santander shareholders. Botín in reply to criticism said that the bank’s ‘clients were of the upmost importance’. He went on to say that the bank had 80 million clients worldwide and it was this that formed the base of the bank. He added that the bank would continue to look alter its clients.
Botín said that Santander was analyzing all aspects of the Madoff case and looking at possible legal action.
The losses incurred by Santander clients as a result of the Madoff fraud saw 120 million euros disappear from their accounts. Clients affected included private investors which lost up to 150,000 euros each to institutions such as colleges and foundations which lost up to 10 million euros. All of these clients are asking for compensation from Santander and have formed an action group numbering around 600 investors.
The first case against Santander and its subsidiary ‘Optimal’ has been brought to court in the South of Florida in a case where dozens of investors have presented their demands for multimillion losses made by the 'Optimal Strategic US Equity Fund'.
Santander bank has decided to face up to the damage that the fraud carried out by the wall street stock broker, Bernard Madoff, has done to its clients faith in the bank despite declarations by Emilio Botín to the contrary when the scandal first came to light.
Private clients affected by the fraud perpetrated by Madoff and which affected the bank’s ‘Optimal’ fund will get 100% of their initial investment back. However, no solution has been offered for institutional clients of the bank who have also lost large amounts.
The cost to the bank is expected to be around 500 million euros which is expected to be taken from the 2008 profits for Santander due to be announced on 5th February.
Compensation will be given via means of the emission of 1,300 euros in shares with an annual rate of return of 2% with the option of Santander buying them back alter 10 years.
According to a statement by Santander bank the group took the decision to make good the losses incurred by private investors due to exceptional circumstances and also for commercial reasons so that the bank could maintain its business relations with these clients.
A spokesperson for the bank said that ‘the sale of these products has always been transparent’ due to the number of supervisory bodies in the US such as the SEC which did not detect anything despite the fact that Madoff securities was regularly inspected in recent years.
The compensation package for private clients of Santander bank was announced on Monday this week at a meeting of Santander shareholders. Botín in reply to criticism said that the bank’s ‘clients were of the upmost importance’. He went on to say that the bank had 80 million clients worldwide and it was this that formed the base of the bank. He added that the bank would continue to look alter its clients.
Botín said that Santander was analyzing all aspects of the Madoff case and looking at possible legal action.
The losses incurred by Santander clients as a result of the Madoff fraud saw 120 million euros disappear from their accounts. Clients affected included private investors which lost up to 150,000 euros each to institutions such as colleges and foundations which lost up to 10 million euros. All of these clients are asking for compensation from Santander and have formed an action group numbering around 600 investors.
The first case against Santander and its subsidiary ‘Optimal’ has been brought to court in the South of Florida in a case where dozens of investors have presented their demands for multimillion losses made by the 'Optimal Strategic US Equity Fund'.
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