Civil complaints, brought by the SEC and the CFTC in the US, led to the need for interpleader proceedings. Both regulators filed similar complaints against Nikolai Battoo (and a number of entities owned or controlled by him) as a consequence of the allegedly fraudulent scheme which aimed to mask losses incurred in certain feeder funds’ investments to the Bernard Madoff Ponzi scheme and others; Battoo allegedly induced investors to plough further funds into the investment portfolios, or not to redeem their investments, on the back of misleading investment performance reports, the Carey Olsen statement said.

The CFTC appointed a receiver over Battoo’s assets and entities and liquidators were appointed in the Bahamas over two Panamanian entities named in the US proceedings (the Bahamian liquidators).

Efforts to repatriate the hedge funds’ assets and other moves were delayed by the US Receiver and the Bahamian liquidators on the basis that some of the investors in the Battoo entities may also have claims over some of the assets.

“However, despite asserting such claims in correspondence, no evidence or detail of these claims has yet been filed with the Royal Court [in Guernsey] or, more properly, in the liquidations four months after proceedings started and nearly a year after the receiver was appointed,” Carey Olsen said.