A Guernsey court has denied US regulators who were pursuing money allegedly linked to Ponzi fraudster Bernard Madoff the right to interfere with moves to distribute surplus assets from hedge funds incorporated in the British Virgin Islands and Anguilla.

The Royal Court of Guernsey yesterday confirmed that “non-parties” seeking to be joined to current litigation had to satisfy certain tests before being allowed to join proceedings, according to a statement issued by [tag|Carey Olsen|]Carey Olsen[/tag], which acted for the liquidators. The liquidators wanted to repatriate assets held in accounts in Guernsey to the BVI and Anguilla so that the liquidation could go ahead.

“The ultimate aim is to distribute the surplus assets of those entities forced into liquidation to their respective creditors and investors. The US Securities and Exchange Commission and the US Commodity Futures Trading Commission were seeking to cut across the hedge funds’ liquidations and have those same assets repatriated to the US in an effort to pay back creditors and investors in different entities also involved in an allegedly fraudulent scheme,” the law firm said.

EFG Private Bank (Channel Islands) issued interpleader proceedings to determine the competing rights and claims over the assets it holds in Guernsey on behalf of the hedge funds.