Deutsche Bank settles $1.6bn US lawsuit

BLOOMBERG

Deutsche Bank AG is settling a US lawsuit it filed against a pair of offshore feeder funds that backed out of an alleged deal to sell the German lender $1.6 billion in claims against Bernard Madoff’s bankrupt investment advisory business.
Lawyers for Deutsche Bank and the funds — Kingate Global Fund Ltd and Kingate Euro Fund Ltd — filed a joint letter in New York federal court saying they’d struck a deal but didn’t disclose any terms. The deal still needs court approval in “multiple
jurisdictions,” the parties said.
The funds, founded in the British Virgin Islands in 1994, funnelled $1.7 billion of client money to Madoff’s firm before his $20 billion Ponzi scheme collapsed in 2008. They agreed to sell their claims against Madoff’s firm to Deutsche Bank for 66 cents on the dollar in 2011, but backed out after getting “sellers’ remorse” when the value of the claims increased, Deutsche Bank alleged.
Deutsche Bank spokesman Dylan Riddle has declined to comment.