"Fairfield violated its fiduciary duties in myriad ways. It, in essence, served as an outside marketing agent for Madoff, as opposed to an independent investment advisor that was looking for an evaluating the best investments for its investors. Fairfield's lack of meaningful due diligence was so glaring that it comes as no surprise that Fairfield did not discover that Madoff's operation was no more than a large Ponzi scheme," the court papers concluded.
The spokesperson for Fairfield said there are many "misleading" aspects of the complaint "which is based on nothing more than 20-20 hindsight that supposes that anyone familiar with Madoff's operations should have determined that it was a Ponzi scheme."
"The SEC, other regulatory agencies and every other investor in Madoff failed to detect his sophisticated fraud. FGG is appalled by the Madoff losses suffered by its investors, including its employees and the three investors who reside in Massachusetts," said the spokesperson.