Insurers Argus and Tremont Settle Madoff Suit

Insurers Argus and Tremont Settle Madoff Suit - 9/2/2009

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2009 News and Press Releases

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News	News 2009
HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

SETTLEMENT NEWS:

Insurers Argus and Tremont Settle Madoff Suit, VA and VUL Customers Will Be Eligible For Loans If Madoff Losses Put Their Policies At Risk Of Lapsing
Darla Mercado

InvestmentNews. September 2, 2009
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EXCERPT: Insurers Argus Group Holdings Ltd. and Tremont International Insurance Ltd. have reached a partial settlement in a lawsuit filed by variable-annuity and variable-universal-life customers who lost money in Bernard Madoff’s $65 billion Ponzi scheme, according to court documents. The class action, led by Swiss company Chateau Fiduciaire SA, was filed on behalf of investors who had purchased or held VUL insurance policies or deferred variable annuities issued by Argus and Tremont — and managed by Tremont Capital Management, Rye Investment Management or SHL Capital Ltd. — between May 1994 and December 2008. The suit alleged that the companies had entrusted the investors’ assets to Mr. Madoff’s investment scheme without conducting due diligence, thus violating their fiduciary duty. The settlement won’t pay out a financial settlement to the plaintiffs, but it will allow them to participate in a special loan facility if their policies are at risk of lapsing because of the investments in the Rye Select Funds or the SHL Multi Strategy Insurance Dedicated Fund. If a client’s policy isn’t at risk of lapsing, but has suffered losses from the funds, the policyholder may also opt to have his or her policy loan terms enhanced. Clients can also choose to assign certain Argus claims to a litigation trust. These cases are part of a large cluster of Madoff-related lawsuits against Tremont Group Holdings Inc., a hedge fund that is owned by Massachusetts Mutual Life Insurance Co., and other defendants. Tremont Group Holdings, which had lost some $3 billion in client assets through Madoff investments and has been selling off assets to refund investors, hasn’t settled in this most recent legal action. A call to Tremont Group Holdings wasn’t immediately returned.

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