[Editor's note: The following information was issued in a press release from the First Selectman's Office.]
A Stamford Superior Court judge entered a $2.9 million judgment Friday in favor of the town of Fairfield against an investment firm that had placed the town’s retirement funds with Bernard Madoff. The judgment was against Maxam Capital Management, a Darien investment adviser that had sold the town’s two retirement plans in an investment with Madoff in 2007.
“With this judgment today, the town has achieved a total recovery in its Madoff-related claims of over $15.4 million," First Selectman Michael Tetreau said.
"This is the total amount the town had invested with Madoff.”
Fairfield brought claims against Maxam in 2009 and a number of other investment advisers and pension consultants, contending that they either knew that Madoff’s claimed investment strategy was fraudulent or failed to do proper investigation of Madoff’s false trading activity. The town had previously settled with the other investment advisers and consultants. The judgment entered Friday resolved the town’s remaining final claim. After accounting for attorneys’ fees and litigation costs, the town recovered 80 percent of its loss.
“The town and the pensions boards have been committed to doing everything possible to recover the funds lost to Madoff," Tetreau said. "We are very appreciative of the excellent work done by our attorneys.”
Fairfield was represented by David Golub of Stamford's Silver Golub & Teitell LLP and Richard Robinson of Pullman & Comley in Hartford.
“When we started, people were saying that Madoff had fooled everyone and that there was no way the town would be able to win any of its claims," Golub said.
"But the evidence showed that many people on Wall Street refused to do business with Madoff because they questioned his returns. And with that evidence, we were able to recover the town’s lost funds”
Robinson echoed Golub’s remarks. “It was a lot of work, but in the end, we were able to develop evidence that led to the town’s recoveries.”