This is Money – After the banks, talk was that hedge funds would be next. The prediction has proved correct – but not in a way anyone imagined. It was always supposed that as the recession deepened, hedge funds would struggle to make their returns and clients would want their money out.
That is what happened with the Bernard Madoff scandal, but what the rush to redemption exposed was something far worse than a stuttering performance – fraud on a vast scale. Madoff’s extraordinary ability to hoodwink the investment community, including other hedge funds, has brought into question the industry’s future.
