A hedge fund group owned by Massachusetts Mutual Life Insurance Co. has agreed to pay more than $1 billion to customers of imprisoned fraudster Bernard Madoff, in one of the largest settlements with the trustee in Madoff bankruptcy case.
Under the agreement, announced today, Tremont Group Holdings of Rye, N.Y., and its Rye Select family of funds, will pay more than $1 billion to the fund for defrauded Madoff clients. The entities were the second-largest of the so-called feeder funds to Madoff, private portfolios that directed billions of dollars in client assets to Madoff.
The settlement agreement includes Tremont’s former chief executive; the group’s owner, Oppenheimer Acquisition Corp.; and Springfield-based MassMutual, Oppenheimer’s parent.
According to the complaint, the Tremont Group and related entities were aware, through warnings in both internal communications and publicly available information, that the Madoff operation could be a fraud.