As per the US federal and New York law, investors who had withdrawn principal or profits in the 90 days before Mr. Madoff’s December 11 arrest, are especially susceptible to “clawbacks”.
Santander had confirmed that its funds had withdrawn money in the 90-day period before Mr. Madoff’s arrest and said it was pleased to have cleared that set of legal issues with the trustee.
The settlement by the bank will return about 85% of the money that the bank’s hedge fund affiliate, Optimal Investment Services, had swindled from its accounts with Madoff in the years before the fraud is revealed. The settlement, which still needs to be approved by a US court, if approved, will swell the pool of money accessible to pay off Madoff’s victims to more than $1.2 billion.
Irving Picard, the court-appointed trustee supervising the remnants of Madoff’s firm, said in a statement that he hoped the settlement with Optimal Investment Services would drive other companies to settle, for the benefit of all of Madoff’s victims.
