Senior executives at JPMorgan Chase had serious doubts about the investments of Bernard Madoff before his company collapsed in the largest Ponzi scheme in history, according to internal bank documents made public on Thursday.
The trustee gathering assets for Madoff's victims released the documents as part of a lawsuit against JP Morgan Chase seeking $6.4 billion in recovery and damages.
In a 114-page complaint, Madoff trustee Irving Picard alleges the bank knew or should have known that Madoff was likely engaging in fraud.
"Incredibly, the bank's top executives were warned in blunt terms about speculation that Madoff was running a Ponzi scheme, et the bank appears to have been concerned only with protecting its own investments in BLMIS feeder funds," said Deborah Renner, a partner at Baker & Hostetler, the court appointed counsel for the trustee.
Despite filing under seal claiming it was at Chase bank's request, Picard now says such records should be available for public review in agreement with Chase lawyers.
Renner said there is "much, much more to come in the way of documents and testimony" regarding the case.
