According to The Economic Times (08/18/11), Irving Picard, the trustee in the Madoff fraud situation, amended a $2 billion lawsuit against UBS AG, adding new allegations to the claim against the financial firm. Picard alleges that the bank misled regulators about its relationship with Madoff while it was sending money to Madoff's Ponzi scheme.
Suits had already been filed against HSBC Holding Plc, UBS and JPMorgan Chase & Co, although the HSBC lawsuit was thrown out of court, with a judge finding Picard did not have the authority to sue third parties on behalf of Madoff clients.
Picard alleges that UBS collected approximately $80 million in fees from its relationship with Madoff. A spokesperson for UBS says the financial firm was not aware of Madoff's wrongdoing. Bloomberg (08/17/11) reports that Madoff is serving 150 years in prison for his Ponzi scheme, which was discovered in December 2008.
Madoff reportedly ran the largest Ponzi scheme in US history since the 1980s, telling clients his accounts were worth up to $65 billion when in fact he was using the money to fund his lifestyle, including a penthouse and yachts.
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Meanwhile, investors in Countrywide Financial Corp. filed a lawsuit against the financial firm, alleging it misled them about risks it took in the subprime mortgage crisis. Among the plaintiffs are the California Public Employees' Retirement System and BlackRock Inc. According to the Los Angeles Times (07/29/11), 16 investors joined the lawsuit, alleging their investments plummeted in value when the subprime mortgage crisis hit.