In a safe that needed a locksmith to open two years later
It’s been nearly nine years since Bernie Madoff’s $68 billion ponzi scheme was revealed. Just about eight since he was sentenced to 150 years in prison.
Now, Principal Financial Group is accusing hedge fund Liongate Capital Management of hiding investments with Madoff, according to Bloomberg. Principal claims Liongate founders Randall Dillard and Jeff Holland, as well as head of research Benjamin Funk, negotiated and then sold their stakes in Liongate in early March 2013 after failing to disclose that they had invested in a Madoff feeder fund. Principal believes these funds helped direct clients toward Madoff.
“Knowledge in the industry that a Liongate fund had invested in Madoff funds would lead to existing investors in Liongate funds withdrawing funds and would discourage new investment,” Principal said, according to Bloomberg.
The investments were reportedly found in a safe that had been locked for two years at Liongate’s headquarters. Apparently no one had the winning combination at the time (Liongate shut down in 2015 amid tough conditions for hedge funds), so locksmiths were called in to open it up, Bloomberg reported.
Feeling intentionally misled, Principal filed a lawsuit against the hedge fund for as much as $66 million in damages.