A French woman and her daughter are bringing a law suit against Orange Bank to try to recover some of the 439 million euros ($516 million) they say they lost in the collapse of Bernard Madoff’s Ponzi scheme a decade ago, according to Reuters.
Laurence Apfelbaum and her daughter Emilie allege that Banque Finama advised them in 1999 to work directly with Madoff’s investment funds, where they had already placed money via Finama, when Finama was itself withdrawing assets from the scheme because of doubts about Madoff’s credibility.
Finama, which was later renamed Groupama Banque, was acquired by French telecoms operator Orange (ORAN.PA) in 2016 and turned into Orange Bank, a mobile banking business.
A civil court in Bobigny, north of Paris, will begin proceedings on the case on Oct. 2. Orange Bank will contest the claim.
The case underscores how the ripples from Madoff’s $60 billion scheme, one of the biggest financial frauds in history, can still be felt in the financial system 10 years on.
Madoff pleaded guilty to federal crimes including securities and investment fraud in 2009. He was sentenced to 150 years in prison and ordered to pay restitution of $170 billion.
Nicolas Lecoq-Vallon, a lawyer representing the Apfelbaums, says they would have withdrawn their funds from Madoff’s scheme in 1999 if Finama had shared its suspicions with them.
Instead, he said Finama shut the Apfelbaums’ accounts and told them to deal one-to-one with Madoff.
“The bank advised my clients to deal directly with Madoff’s firm when it had to — at the very least — warn them and share the doubts it had about the legitimacy of the scheme,” he told Reuters.
At around the same time in 1999, Finama withdrew about 100 million euros that it had invested with Madoff, Lecoq-Vallon said, citing comments made by Bernard Pouy, who was the bank’s chief executive at the time.
Pouy, who was quoted in interviews in 2009 saying Finama withdrew its funds after concluding that Madoff’s scheme was suspect, didn’t return calls seeking comment.
