Defender Limited
{{short description|Investment fund}}
{{Infobox company
| name = Defender Limited
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| genre = investment fund
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| founded = May 2007 in British Virgin Islands
| founder = Reliance Group
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| hq_location_country = British Virgin Islands
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Defender Limited is an investment fund. It was incorporated in the British Virgin Islands in 2007. Defender funneled clients' funds to Bernard Madoff's firm as part of a Ponzi scheme run by Madoff.{{cite news|url=https://www.reuters.com/article/us-madoff-settlement-idUSKBN0MJ2F720150323|title=Madoff feeder fund settles; victims' recovery tops $10.6 billion|date=23 March 2015|work=Reuters}}{{cite web|url=https://www.wsj.com/articles/madoff-trustee-strikes-93-million-deal-with-feeder-fund-1427222162|title=Madoff Trustee Strikes $93 Million Deal with Feeder Fund|first=Sara|last=Randazzo|date=24 March 2015|work=The Wall Street Journal}}{{cite web|url=http://bvibeacon.com/vi-feeder-fund-sues-bank-to-recover-madoff-monies/|title=VI 'feeder fund' sues bank to recover Madoff monies|date=4 December 2013|website=The BVI Beacon}}{{cite news|url=https://www.irishtimes.com/business/financial-services/ruling-casts-doubt-on-141m-case-against-hsbc-s-irish-arm-1.3722911|title=Ruling casts doubt on $141m case against HSBC's Irish arm|first=Mary|last=Carolan|newspaper=The Irish Times}}{{cite book|url=https://books.google.com/books?id=FwA5AgAAQBAJ&dq=%22defender%22+%22madoff%22+%22hsbc%22&pg=PT138|title=The Believers: How America Fell For Bernard Madoff's $65 Billion Investment Scam|first=Adam|last=LeBor|date=8 October 2009|publisher=Orion Publishing Group|via=Google Books|isbn=9780297859222}} Madoff was arrested in December 2008, and pleaded guilty to fraud in 2009. He is serving a 150-year prison term.
Formation
Defender was formed in May 2007. It was formed with the support of individuals who had encouraged investing with Madoff since 1999. According to the Securities Investor Protection Act (SIPA) Trustee for BLIMIS assets Irving Picard, Defender was created by the Reliance Group. The Reliance Group was, according to Picard, in turn established by Tim Brockmann, an investment manager in Switzerland and Gibraltar.{{Cite web|url=https://www.madofftrustee.com/document/dockets/002847-defenderlimitedbrief10-05229docket49.pdf|title="TRUSTEE'S MEMORANDUM OF LAW IN OPPOSITION TO MOTION OF RELIANCE MANAGEMENT (BVI) LIMITED, RELIANCE MANAGEMENT (GIBRALTAR) LIMITED AND TIM BROCKMANN TO DISMISS THE TRUSTEE'S COMPLAINT BASED ON A LACK OF PERSONAL JURISDICTION"}}
Activities
Defender acted as a feeder fund, by funneling clients' funds to Bernard Madoff's firm, Bernard L. Madoff Investment Securities (BLMIS), as part of a Ponzi scheme run by Madoff. Madoff was arrested in December 2008, and pleaded guilty to fraud in 2009. He is serving a 150-year prison term.
Litigation
In December 2013, Defender sued HSBC Continental Europe (formerly HSBC France; HSBC Institutional Trust Services Incorporated), an Irish subsidiary of HSBC Bank with registered offices in Dublin, in an Irish court for $539 million.{{cite web|url=https://www.lexology.com/library/detail.aspx?g=f2616787-5f11-4eb0-8af8-dce3a3003fcf|title=Hard to Gain, Easy to Lose? - Lexology|first1=William Fry-Paul|last1=Convery|first2=Derek|last2=Hegarty|website=lexology.com|date=November 2018 }}{{cite web|url=http://www.royalgazette.com/article/20110321/BUSINESS02/703219913|title=HSBC warned about Madoff 'fraud and operational risks' in two KPMG reports - The Royal Gazette:Bermuda International Business|first=Boris|last=Groendahl|website=The Royal Gazette|date=21 March 2011 }} Defender alleged that the bank failed to conduct adequate due diligence on Madoff, and failed to warn Defender that HSBC was not able to confirm the existence of Defender's assets.{{cite web|url=https://www.independent.ie/irish-news/irish-arm-of-hsbc-bank-being-sued-over-madoff-scheme-29802611.html|title=Irish arm of HSBC bank being sued over Madoff scheme|website=The Irish Independent|date=2 December 2013 }}{{cite web|url=https://bvi-grey-area.offshore-journals.com/bvi-investment-fund-sues-hsbcs-arm-over-madoff-polzi-scheme-806.html|title=BVI investment fund sues HSBC's arm over Madoff Ponzi scheme - BVI Offshore Business: Grey Area|last=Mike|access-date=2019-02-23|archive-date=2019-09-20|archive-url=https://web.archive.org/web/20190920184248/https://bvi-grey-area.offshore-journals.com/bvi-investment-fund-sues-hsbcs-arm-over-madoff-polzi-scheme-806.html|url-status=dead}} In December 2018, the High Court of Ireland ruled that Defender's claim against HSBC was reduced by 100% due to Defender's earlier settlement with BLMIS. Defender appealed that decision to the Irish Court of Appeal.{{cite news|url=https://www.irishtimes.com/business/technology/judge-says-recusal-hearing-in-madoff-case-would-be-waste-of-court-time-1.3739795|title=Judge says recusal hearing in Madoff case would be 'waste of court time'|newspaper=The Irish Times}} On April 14, 2021, the day Madoff died, the case settled immediately before proceedings were due to begin in court before Mr Justice Mark Sanfey, and was scheduled to last 24 weeks.{{Cite news|url=https://www.irishtimes.com/business/financial-services/marathon-madoff-ponzi-case-settled-before-opening-in-high-court-1.4537407|title=Marathon Madoff Ponzi case settled before opening in High Court|newspaper=The Irish Times}}
On April 16, 2015, the United States Bankruptcy Court for the Southern District of New York approved an agreement between Picard on the one hand, and Defender and related entities on the other hand.[https://www.madofftrustee.com/recoveries-25.html "Defender"] The BLMIS Customer Fund benefited by $93 million. Defender received a $522.8 million claim in the BLMIS liquidation, because Defender had deposited more with BLMIS than Defender withdrew.
See also
References
{{reflist}}
{{Madoff investment scandal}}
Category:Investment companies of the British Virgin Islands