PE Firms Among Madoff Victims

Private equity firms Audax Group and Cortec Group were among those scammed by Bernie Madoff, according to a 162-page customer list filed yesterday with the U.S. Bankruptcy Court in New York (download here). Also ripped off was a hedge fund managed by Thomas H. Lee, institutional consultancy Cambridge Associates, legendary venture capitalist Arthur Rock and Sun Capital Partners co-CEO Rodger Krouse.

peHUB contacted Marc Wolpow, a co-CEO of Audax Group, who said the following: “We did not have any of our limited partners’ — or investors’ – funds invested in Madoff. Audax is not a feeder fund. Our business is to invest in companies, not other funds. Thus I can assure you that our investors do not have any exposure (either direct or indirect) to Madoff through their investment in any Audax fund. [Co-CEO] Geoff Rehnert and I, along with so many others, did invest a small portion of our personal assets in Madoff. This is obviously a decision that we regret, and one that is quite frankly painful and embarrassing.”

David Schnadig, a managing director of Cortec Group, echoed a similar sentiment: “This was individual partner money of Cortec folks. Not one penny of LP money was invested [with Madoff].”

Cambridge Associates says, via a spokeswoman, that its inclusion was based on the firm’s past requests for info from Madoff, in order to conduct due diligence. She adds that CA never recommended that its clients invest with Madoff, and that individual CA staffers did not invest with him.

If you see any other relevant names on the list, please let us know…