Madoff Business Associate De La Villehuchet Found Dead

The well-respected fund manager appears to have committed suicide.

ByABC News
December 23, 2008, 2:53 PM

Dec. 23, 2008— -- Thierry Magon de La Villehuchet, a well-respected French investment fund manager who put at least $1.4 billion of his clients' money -- and perhaps much or all of his own wealth -- in the hands of alleged Ponzi scheme operator Bernard Madoff, appears to have committed suicide in his Manhattan office, according to police officials.

De La Villehuchet, 65, was found inside the Madison Avenue offices of his investment group, Access International Advisors, at about 7:30 a.m. this morning and pronounced dead at 8 a.m., according to the New York City Medical Examiner.

He was found seated at his desk, where he apparently had bled to death after taking an overdose of sleeping pills and then slashing his arm, bicep and his wrists, police said.

"They found the man at his desk," New York City Police Commissioner Raymond Kelly said. "There was no suicide note. It appears there were cuts made to his arm, to his wrist and also to his bicep area with a box cutter." Villehuchet's family in New York has been notified of the death, according to officials.

European fund managers who knew de La Villehuchet described him to as a man who inspired "a lot of respect, honour, humanity, kindness and generosity." They said Villehuchet had a strong belief in Madoff and had not only committed his own money to Madoff, but did so with 150 percent leverage -- in effect, his potential losses were greater than his actual wealth.

Access International's LUXALPHA SICAV-American Selection fund invested solely with Madoff, and is one of several large funds that has been the subject of the ongoing federal investigation into what prompted them to place large amounts of client money with Madoff despite red flags that had been raised for well over a year by some inside the hedge fund community. The fund had at least $1.4 billion and perhaps closer to $2 billion in money under management, placing it in the top tier of funds that appear to have lost most if not all of their investment in the scandal.

A French business journal today quoted a person close to the Villehuchet family as saying, "for the past week, he had tried day and night to find a way to recoup his investors' money and had begun legal action in the United States against U.S. authorities. He could not stand the hunt for culprits launched by the Europeans. This is a farewell from someone who had done nothing wrong. The truth is that everyone wanted to invest with Madoff, considered by everyone to be AAA, i.e. absolute security."

The U.S.-based Fairfield Greenwich Group investment operation was one of the first to disclose such losses -- acknowledging shortly after Madoff's arrest earlier this month a loss of $7.5 billion from its Fairfield Sentry fund.

Walter Noel, a founding partner of FGG, whose press operation has called his firm one of Madoff's first victims, has recently been seen at some of New York's toniest holiday parties wearing a red velvet jacket.

The list of known Madoff victims has continued to grow in the days following his alleged admission to the FBI that he ran a Ponzi scheme that, for more than 30 years, had fleeced investors -- using the money from each fresh crop of investors to pay earlier marks the steady rate of return that they had come to expect. As it developed, the elaborate investment model he described to his investors as the basis for his ability to provide year in, year out double digit returns, allegedly was nothing but a smoke screen.

De La Villehuchet's body has been released to the New York City medical examiner. While there was nothing contained in the initial police reports to indicate the death was anything other than a suicide, no official cause of death has been released. The medical examiner did not expect to rule until at least tomorrow.

Madoff made headlines earlier this month when an unsealed criminal complaint in federal court in New York charged that he has been running the decades-long Ponzi scheme that defrauded investors of $50 billion.

A former chairman of NASDAQ, Madoff was an investment advisor who catered to a handful of high net worth clients, one of whom told ABC News that Madoff was so sought after that, as recently as two months ago, he was turning down potential new business. His handful of clients routinely expected -- and received -- double digit returns, up market or down.