FutureSelect Portfolio Management v. Ernst & Young

Summary

A Washington State court jury sided with investors on Friday who lost $112 million dollars in Bernie Madoff’s historic Ponzi scheme in their lawsuit against Ernst & Young LLP, finding that the accounting giant was negligent by signing off on audits of billions in assets that didn’t exist.

Friday’s verdict marks the first time a jury has weighed in on the role accounting practices played in contributing to losses suffered by investors who sank money into Madoff-controlled funds. The jury awarded approximately $20.3 million in damages to FutureSelect Portfolio Management Inc. while also finding the investment firm to be 50 percent responsible for its own losses. The actual damages amount will be reduced to $10.15 million, though FutureSelect’s attorney Steven Thomas told Courtroom View Network that pre-judgment interest will push the amount back above $20 million.

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Outcome

Total damages: $20.3 million

Percentage of responsibility:
FutureSelect - 50%
Ernst & Young - 50%

Actual damages awarded: $10.15 million