After four years, Westport National Bank’s involvement with convicted swindler Bernie Madoff is still bringing unwanted publicity—the latest a New York Times story today saying it is in the spotlight because of lawsuit brought by investors who lost a combined $60 million. 
Hartford trial again puts Westport National Bank in spotlight. (CLICK TO ENLARGE) Dave Matlow for WestportNow.com/file
“Among the far-flung feeder funds, brokerage houses and institutions interconnected in the vast Ponzi scheme perpetuated by Bernard L. Madoff, one little-known local bank is now in the spotlight,” the Times wrote in its DealBook column.
“Westport National Bank and its parent company, Connecticut Community Bank, is the type of Main Street bank found in Anytown U.S.A., rather than near Wall Street. It has one main office and nine affiliated branches, all within a small radius stretching from Fairfield to Greenwich.
“But to more than 200 individual investors, it was the bank that should have stood sentry over their money. A lawsuit brought by investors who lost a combined $60 million in the Madoff Ponzi scheme seeks to show that the bank failed at its job as the custodial bank in charge of their money.”
The Times added: “Though it was one of many institutions entangled with Mr. Madoff and his firm, Bernard L. Madoff Investment Securities, the trial serves as a cautionary tale for any investor on the role and duties of custodial banks.
“The central question at the heart of the civil case is what obligation, if any, such banks have in determining whether the assets of investors exist at all.”
It said a federal jury in Hartford finished hearing eight days of evidence last month in the case and closing arguments are expected to be heard on Thursday.
The case dates back to 2009 when the bank sought to assure customers and employees that it acted only as a custodian for customers investing in Bernard Madoff Investment Securities. (See WestportNow Jan. 2, 2009)
