Wednesday, December 24, 2008
Booker Prize sponsor damaged by Madoff losses
Last Sunday's book section of the New York Times features an alarming story by Dave Itzkoff. The Man Group, a publicly traded investment company and hedge fund that has sponsored the Booker Prize since 2002, announced that it had about $360 million in funds linked to the rogue Wall Street executive Bernard L. Madoff (pictured).
Former Nasdaq chairman Madoff was recently arrested on a charge of making off with fifty billion dollars entrusted to his companies by trusting investors, in the most high profile collapse of a hedge fund to date. Breaking news is that a New York-based money manager who may have lost $1.4 billion of client funds in Madoff investments has killed himself in his Madison Avenue office. By contrast, Madoff, who appears to have no conscience at all, is probably headed for a comfortable white collar prison.
His shenanigans have sent two European banks to the edge: Royal Bank of Scotland and Santander have lost hundreds of millions of dollars. "Madoff has single-handedly turned an already very bad year for hedge funds into a catastrophe," said one commentator, according to Times On Line. So is it a catastrophe for the Man Booker, too?
Apparently not. Man Group's loss, though it appears huge to ordinary folks like you and me, wipes out only 1.5% of its assets, and the company insists that the sponsorship deal will not be changed or cancelled.