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Writ filed against Bank of Bermuda (Cayman)

In ongoing legal action linked with convicted fraudster Bernard Madoff’s Ponzi scheme a writ has been issued against Bank of Bermuda (Cayman) Limited.

The bank is a wholly-owned subsidiary of HSBC Bank Bermuda Limited.

The legal action also names HSBC Securities Services (Luxembourg) as a second defendant.

The writ has been lodged with the Grand Court of the Cayman Islands by Cayman-based Primeo Fund, which is in official liquidation.

Primeo had funds invested with Madoff but took $145 million out of the firm in the six years before its 2008 bankruptcy.

In the writ, Primeo claims Bank of Bermuda (Cayman), while it was acting as administrator of Primeo, was in breach of contract in respect of incorrectly determining Primeo’s net asset value. It is seeking damages.

With regard to HSBC Securities Services (Luxembourg), Primeo claims damages for breach of contract when HSBC Securities Services acted as custodian to the Primeo Fund.

Primeo claims HSBC Securities Services failed to keep safe Primeo’s securities, which were deposited with Bernard L Madoff Investment Securities as sub-custodians.

And Primeo further claims that either or both defendants are liable to compensate it in damages for losses it has suffered as a result of being under a liability, if any, to the Trustee for the Liquidation of Madoff’s firm.

Regarding the writ, which was issued on February 20, a HSBC Bank Bermuda spokesperson said: “The Bank does not comment on active litigation.”

Bernard Madoff is currently serving a 150-year jail in the US term for fraud.

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Published February 28, 2013 at 8:00 am (Updated February 27, 2013 at 6:11 pm)

Writ filed against Bank of Bermuda (Cayman)

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