Anwar et al v. Fairfield Greenwich Limited et al

Filing 545

ANSWER to Amended Complaint with JURY DEMAND. Document filed by Lourdes Barenche, Lourdes Barreneche, Cornelis Boele, Vianney D'hendecourt, Fairfield Greenwich (Bermuda) Ltd., Fairfield Greenwich Advisors L.L.C., Fairfield Greenwich Limited, Fairfield Heathcliff Capital LLC, Fairfield Risk Services Ltd., Harold Greisman, Jacqueline Harary, Richard Landsberger, Daniel Lipton, Julia Luongo, Mark Mckeefry, Charles Murphy, Walter M. Noel, Jr, Andres Piedrahita, Corina Noel Piedrahita, Maria Teresa Pulido Mendozo, Santiago Reyes, Yanko Dellaw Schiava, Andrew Smith, Philip Toub, Jeffrey Tucker, Amit Vigayvergia, Amit Vijayvergiya.(Cunha, Mark)

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK -----------------------------------------------------------------x ANWAR, et al., Plaintiffs, v. FAIRFIELD GREENWICH LIMITED, et al., Defendants. This Document Relates To: All Actions -----------------------------------------------------------------x :: :: :: :: :: :: :: :: MASTER FILE NO. 09-CV-0118 (VM) :: :: :: :: :: ::

FG DEFENDANTS' ANSWER TO THE SECOND CONSOLIDATED AMENDED COMPLAINT Defendants Fairfield Greenwich Limited ("FGL"), Fairfield Greenwich (Bermuda) Limited ("FGBL"), Fairfield Greenwich Advisors LLC ("FGA"), Fairfield Risk Services Limited ("FRS"), Fairfield Heathcliff Capital LLC ("FHC"), Lourdes Barreneche, Cornelis Boele, Yanko Della Schiava, Harold Greisman, Jacqueline Harary, Vianney d'Hendecourt, Richard Landsberger, Daniel Lipton, Julia Luongo, Mark McKeefry, Charles Murphy, Walter M. Noel, Jr., Andres Piedrahita, Corina Piedrahita, Maria Teresa Pulido Mendoza, Santiago Reyes, Andrew Smith, Philip Toub, Jeffrey Tucker and Amit Vijayvergiya (collectively, "FG Defendants"),1 through their undersigned counsel, respond to the Second Consolidated Amended Complaint ("SCAC") as follows:2
1

Per Judge Marrero's Order on March 22, 2010, Lion Fairfield Capital Management Limited ("LFCM") was dismissed from this action and, therefore, no response is required or provided on its behalf. Capitalized terms not defined herein shall have the meaning set forth in the SCAC.

2

NATURE OF THE ACTION 1. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 1 of the SCAC, except aver that Fairfield Greenwich Group ("FGG") is a marketing name used for certain businesses of a group of related entities and deny that FGG marketed and operated the referenced funds.3 2. The allegations in paragraph 2 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants lack knowledge or information sufficient to form a belief as to the truth of the allegations in paragraph 2 of the SCAC. 3. The allegations in paragraph 3 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 3 of the SCAC. 4. The allegations in paragraph 4 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 4 of the SCAC. JURISDICTION AND VENUE 5. The allegations in paragraph 5 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 5 of the SCAC, except lack knowledge or information sufficient to form

3

The SCAC characterizes certain individuals and entities as "partners" or "founding partners" of FGG and refers to these individuals and entities collectively as the "FGG partners." FG Defendants aver that the terms "partner" and "founding partner" were sometimes used, but these individuals and entities were not partners in the legal sense but, rather, the individuals were shareholders of Fairfield Greenwich Limited or its predecessor entities. 2

a belief as to the truth of the allegations regarding whether at least one Plaintiff is a citizen of a foreign state, and aver that at least one Defendant is a citizen of New York. 6. The allegations in paragraph 6 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 6 of the SCAC. 7. The allegations in paragraph 7 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 7 of the SCAC, except aver that one or more of the Defendants reside in this District and the principal place of business of one or more Defendants is in this District. PARTIES 8. The allegations in paragraph 8 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 8 of the SCAC. A. Plaintiffs 1. 1. Fairfield Sentry Limited Investors

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 1 of the SCAC.4 2. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 2 of the SCAC. 3. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 3 of the SCAC.

4

The SCAC contains two sets of allegations numbered 1 through 8. For the purposes of this Answer, FG Defendants conform their responses to the numbering system adopted by Plaintiffs in the SCAC. 3

4.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 4 of the SCAC. 5. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 5 of the SCAC. 6. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 6 of the SCAC. 7. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 7 of the SCAC. 8. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 8 of the SCAC. 9. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 9 of the SCAC. 10. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 10 of the SCAC. 11. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 11 of the SCAC. 12. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 12 of the SCAC. 13. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 13 of the SCAC. 14. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 14 of the SCAC. 15. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 15 of the SCAC. 4

16.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 16 of the SCAC. 17. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 17 of the SCAC. 18. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 18 of the SCAC. 19. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 19 of the SCAC. 20. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 20 of the SCAC. 21. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 21 of the SCAC. 22. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 22 of the SCAC. 23. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 23 of the SCAC. 24. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 24 of the SCAC. 25. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 25 of the SCAC. 26. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 26 of the SCAC. 27. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 27 of the SCAC. 5

28.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 28 of the SCAC. 29. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 29 of the SCAC. 30. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 30 of the SCAC. 31. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 31 of the SCAC. 32. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 32 of the SCAC. 33. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 33 of the SCAC. 34. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 34 of the SCAC. 35. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 35 of the SCAC. 36. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 36 of the SCAC. 37. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 37 of the SCAC. 38. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 38 of the SCAC. 39. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 39 of the SCAC. 6

40.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 40 of the SCAC. 41. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 41 of the SCAC. 42. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 42 of the SCAC. 43. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 43 of the SCAC. 44. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 44 of the SCAC. 45. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 45 of the SCAC. 46. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 46 of the SCAC. 47. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 47 of the SCAC. 48. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 48 of the SCAC. 49. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 49 of the SCAC. 50. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 50 of the SCAC. 51. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 51 of the SCAC. 7

52.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 52 of the SCAC. 53. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 53 of the SCAC. 54. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 54 of the SCAC. 55. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 55 of the SCAC. 56. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 56 of the SCAC. 57. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 57 of the SCAC. 58. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 58 of the SCAC. 59. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 59 of the SCAC. 60. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 60 of the SCAC. 61. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 61 of the SCAC. 62. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 62 of the SCAC. 63. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 63 of the SCAC. 8

64.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 64 of the SCAC. 65. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 65 of the SCAC. 66. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 66 of the SCAC. 67. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 67 of the SCAC. 68. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 68 of the SCAC. 69. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 69 of the SCAC. 70. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 70 of the SCAC. 71. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 71 of the SCAC. 72. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 72 of the SCAC. 73. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 73 of the SCAC. 74. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 74 of the SCAC. 75. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 75 of the SCAC. 9

76.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 76 of the SCAC. 77. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 77 of the SCAC. 78. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 78 of the SCAC. 2. 79. Fairfield Sigma Limited Investors

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 79 of the SCAC. 80. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 80 of the SCAC. 81. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 81 of the SCAC. 82. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 82 of the SCAC. 83. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 83 of the SCAC. 84. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 84 of the SCAC. 85. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 85 of the SCAC. 86. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 86 of the SCAC.

10

87.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 87 of the SCAC. 88. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 88 of the SCAC. 89. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 89 of the SCAC. 90. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 90 of the SCAC. 91. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 91 of the SCAC. 92. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 92 of the SCAC. 93. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 93 of the SCAC. 94. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 94 of the SCAC. 95. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 95 of the SCAC. 96. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 96 of the SCAC. 97. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 97 of the SCAC. 98. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 98 of the SCAC. 11

99.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 99 of the SCAC. 100. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 100 of the SCAC. 101. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 101 of the SCAC. 102. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 102 of the SCAC. 103. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 103 of the SCAC. 104. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 104 of the SCAC. 105. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 105 of the SCAC. 106. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 106 of the SCAC. 107. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 107 of the SCAC. 108. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 108 of the SCAC. 3. 109. Greenwich Sentry, L.P. Investors

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 109 of the SCAC.

12

110.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 110 of the SCAC. 111. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 111 of the SCAC. 112. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 112 of the SCAC. 113. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 113 of the SCAC. 114. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 114 of the SCAC. 115. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 115 of the SCAC. 4. 116. Greenwich Sentry Partners, L.P. Investors

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 116 of the SCAC.5 B. Defendants 1. 117. Fairfield Greenwich Defendants

The allegations in paragraph 117 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants, subject to Footnote 3, deny the allegations in paragraph 117 of the SCAC.

5

On October 1, 2010, the Plaintiffs filed with the Court a Notice and Order Adding Additional Named Plaintiffs ("Notice"), which seeks to add twenty-four additional named plaintiffs as parties to this Action to the same extent as if they had been named as plaintiffs in the SCAC. FG Defendants lack knowledge or information sufficient to form a belief as to the truth of the allegations in paragraphs 1 through 24 of the Notice. 13

118.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 118 of the SCAC, except as follows: (i) FG Defendants, subject to Footnote 3, deny the allegations regarding FGG; (ii) FGL and Mark McKeefry aver that FGL is a company incorporated under the laws of the Cayman Islands, is authorized to do business in New York, was a member of the National Futures Association and was registered with the Commodity Futures Trading Commission as a commodity pool operator until July 2009, served as the Investment Manager for Fairfield Sentry Limited for a period of time ending in 2003, served as the General Partner of Greenwich Sentry, L.P. for a certain period of time, and had certain responsibilities and respectfully refer the Court to the operative documents and agreements concerning FGL for the true and complete contents thereof; and (iii) FGL denies the other allegations in paragraph 118 of the SCAC. 119. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 119 of the SCAC, except as follows: (i) FG Defendants, subject to Footnote 3, deny the allegations regarding FGG; (ii) FGBL, FGL, Mark McKeefry and Amit Vijayvergiya aver that FGBL was a wholly-owned subsidiary of FGL for a period ending January 1, 2008; (iii) FGBL, Walter M. Noel, Jr., Jeffrey Tucker, Andres Piedrahita, Daniel Lipton, Mark McKeefry and Amit Vijayvergiya aver that FGBL served as the Investment Manager for Fairfield Sentry Limited for a certain period of time, served as the Investment Manager for Fairfield Sigma Limited for a certain period of time, and had certain responsibilities and respectfully refer the Court to the operative documents and agreements concerning FGBL for the true and complete contents thereof; (iv) FGBL and Mark McKeefry aver that FGBL is an exempted corporation organized under the laws of Bermuda on June 13, 2003, was registered with the SEC as an investment advisor under the Investment Advisors Act of 1940 for a period of time effective April 20, 2006 to December 3, 2009, served as the General Partner of 14

Greenwich Sentry, L.P. for periods of time including since March 1, 2006, and served as the General Partner of Greenwich Sentry Partners, L.P. since April 11, 2006; and (v) FGBL denies the other allegations in paragraph 119 of the SCAC. 120. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 120 of the SCAC, except as follows: (i) FG Defendants, subject to Footnote 3, deny the allegations regarding FGG; (ii) FGA and Mark McKeefry aver that FGA is a Delaware limited liability company organized on December 12, 2001, is authorized to do business in New York, is registered with the SEC as an investment advisor effective November 17, 2003, and had certain responsibilities and respectfully refer the Court to the operative documents and agreements concerning FGA for the true and complete contents thereof; and (iii) FGA denies the other allegations in paragraph 120 of the SCAC. 121. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 121 of the SCAC, except as follows: (i) FG Defendants, subject to Footnote 3, deny the allegations regarding FGG; (ii) FRS, FGL, Mark McKeefry and Amit Vijayvergiya aver that FRS is a wholly-owned subsidiary of FGL; (iii) FRS, Mark McKeefry and Amit Vijayvergiya aver that FRS had certain responsibilities and respectfully refer the Court to the operative documents and agreements concerning FRS for the true and complete contents thereof; (iv) FRS and Mark McKeefy aver that FRS is incorporated under the laws of Bermuda; and (v) FRS denies the other allegations in paragraph 121 of the SCAC. 122. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 122 of the SCAC, except as follows: (i) FG Defendants, subject to Footnote 3, deny the allegations regarding FGG; (ii) FHC, FGL, Daniel Lipton and Mark McKeefry aver that FHC is a wholly-owned subsidiary of FGL; (iii) FHC, FGBL and Mark McKeefry aver that FHC is an affiliate of FGBL; (iv) FHC, Daniel Lipton and Mark 15

McKeefry aver that FHC was registered with the SEC as a broker-dealer, was a member of the National Association of Securities Dealers, was a member of the Securities Investor Protection Corporation, and transacted business in New York; (v) FHC and Mark McKeefry aver that FHC is a limited liability company organized under the laws of Delaware and is registered as a foreign corporation to do business in New York; and (vi) FHC denies the other allegations in paragraph 122 of the SCAC. 123. Defendant LFCM was dismissed from this action on March 22, 2010. No

additional response is required. To the extent that a response is required, FG Defendants lack knowledge or information sufficient to form a belief as to the truth of the allegations in paragraph 123 of the SCAC, except deny, subject to Footnote 3, the allegations regarding FGG. 124. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 124 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker, Andres Piedrahita, Corina Piedrahita and Walter M. Noel, Jr. aver that Walter M. Noel, Jr. is an American citizen and a resident of Connecticut; (iii) Jeffrey Tucker, Andres Piedrahita and Walter M. Noel, Jr. aver that Walter M. Noel, Jr. served as a general partner of certain funds and served as a director of certain funds for certain periods of time, including Fairfield Sentry Limited and Fairfield Sigma Limited; (iv) Jeffrey Tucker, Corina Piedrahita and Walter M. Noel, Jr. aver that Walter M. Noel, Jr. received a Bachelor of Arts from Vanderbilt University in 1952, a Master of Arts in Economics from Harvard University in 1953 and an LL.B. from Harvard Law School in 1959; and (v) Walter M. Noel, Jr. denies the other allegations in paragraph 124 of the SCAC. 125. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 125 of the SCAC, except as follows: (i) FG Defendants 16

deny, subject to Footnote 3, the allegations regarding FGG; (ii) Walter M. Noel, Jr., Andres Piedrahita and Jeffrey Tucker aver that Jeffrey Tucker is an American citizen; and (iii) Jeffrey Tucker denies the other allegations in paragraph 125 of the SCAC, except lacks knowledge or information sufficient to form a belief as to the truth of the allegation regarding who could authorize movement of cash into and out of accounts that certain Funds maintained at Bernard L. Madoff Investment Securities LLC ("BMIS"), and avers that he is a resident of New York, received a B.A. from Syracuse University in 1966, and received a J.D. from Brooklyn Law School in 1969. 126. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 126 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) FGBL and Andres Piedrahita aver that Andres Piedrahita is a Director of FGBL; (iii) Walter M. Noel, Jr., Jeffrey Tucker, Yanko Della Schiava, Philip Toub, Corina Piedrahita and Andres Piedrahita aver that Andres Piedrahita is a son-in-law of Walter M. Noel, Jr.; (iv) Walter M. Noel, Jr., Corina Piedrahita and Andres Piedrahita aver that Andres Piedrahita holds a Bachelor's Degree from Boston University; (v) Jeffrey Tucker, Corina Piedrahita and Andres Piedrahita aver that Andres Piedrahita is a Colombian citizen and a resident of Madrid; and (vi) Andres Piedrahita denies the other allegations in paragraph 126 of the SCAC, except lacks knowledge or information sufficient to form a belief as to the truth of the allegation regarding who could authorize movement of cash into and out of accounts that certain Funds maintained at BMIS. 127. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 127 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) FGBL, Walter M. Noel, Jr., Jeffrey Tucker, Andres Piedrahita and Amit Vijayvergiya aver that Amit Vijayvergiya worked 17

primarily out of FGBL's Bermuda office; (iii) FGBL, Walter M. Noel, Jr., Jeffrey Tucker and Amit Vijayvergiya aver that Amit Vijayvergiya focused on quantitative risk analysis; (iv) FGBL, Jeffrey Tucker, Andres Piedrahita and Amit Vijayvergiya aver that Amit Vijayvergiya served as Chief Risk Officer of FGL and certain of its affiliates; (v) FGBL, Andres Piedrahita and Amit Vijayvergiya aver that Amit Vijayvergiya served as President of FGBL; (vi) FGBL and Amit Vijayvergiya aver that Amit Vijayvergiya served as President of FGBL from on or about September 2008; and (vii) Amit Vijayvergiya denies the other allegations in paragraph 127 of the SCAC, except avers that he could authorize the movement of cash into and out of accounts that certain Funds maintained at BMIS as of July 2006 (but lacks knowledge or information sufficient to form a belief as to the truth of the allegation he was one of four individuals who could do so), holds an M.B.A. from Schulich School of Business at York University, holds a B.S. in Statistics from the University of Manitoba, holds a B.A. in Economics from the University of Western Ontario, is a Chartered Financial Analyst, and has a Financial Risk Manager Certification. 128. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 128 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Walter M. Noel, Jr., Jeffrey Tucker and Daniel Lipton aver that Daniel Lipton is a Certified Public Accountant; (iii) Jeffrey Tucker and Daniel Lipton aver that Daniel Lipton could authorize the movement of cash into and out of accounts that certain Funds maintained at BMIS as of July 2006, was previously employed at Ernst & Young, and resides and works in New York City; and (iv) Daniel Lipton denies the other allegations in paragraph 128 of the SCAC, except avers that he received a B.A. in Economics from Tufts University and received an M.B.A. in dual degrees in Accounting and Finance from New York University's Stern School of Business.

18

129.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 129 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Mark McKeefry aver that Mark McKeefry is admitted to the bars of California and New York, holds a B.S. from Carnegie Mellon University, and holds a J.D. from Fordham University; and (iii) Mark McKeefry denies the other allegations in paragraph 129 of the SCAC, except avers that he was a member of the Law Review at Fordham University, spent approximately eight years in private law practice, and holds FINRA Series 7, 24, 63 and 65 licenses for which a Form U-5, Uniform Termination Notice for Securities Industries Registration, was filed with respect to such licenses on October 12, 2009. 130. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 130 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Richard Landsberger aver that Richard Landsberger served as a director of LFCM for a certain period of time, that his responsibilities included business development in Europe and Asia, that he directly marketed certain products to a global institutional client base, that he graduated from Boston University, and that he was employed previously at PaineWebber and Citicorp Securities; and (iii) Richard Landsberger denies the other allegations in paragraph 130 of the SCAC, except avers that he received a B.A. from Boston University and an M.B.A. from Cornell University. 131. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 131 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Maria Teresa Pulido Mendoza aver that Maria Teresa Pulido Mendoza was previously employed at Citi Private Bank and James D. Wolfensohn, Inc.; and (iii) Maria Teresa Pulido Mendoza denies the other 19

allegations in paragraph 131 of the SCAC, except avers that she received a B.A. in Economics, cum laude, from Columbia University, received an M.B.A., magna cum laude, from MIT Sloan School of Management, and was previously employed at Bankers Trust/Deutche Bank and McKinsey. 132. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 132 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG and respectfully refer the Court to the referenced "marketing materials" for the true and complete contents thereof; (ii) FGBL avers that David Horn served as a director of FGBL for a certain period of time; (iii) FGL and Jeffrey Tucker aver that David Horn served as a director of FGL for a certain period of time; and (iv) Jeffrey Tucker avers that David Horn was previously employed at Morgan Stanley. 133. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 133 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Andrew Smith aver that Andrew Smith is a graduate of Dartmouth College and holds FINRA Series 7 and 63 licenses for which a Form U-5, Uniform Termination Notice for Securities Industries Registration, was filed with respect to such licenses on April 15, 2009; and (iii) Andrew Smith denies the other allegations in paragraph 133 of the SCAC. 134. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 134 of the SCAC, except as follows: FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; and Charles Murphy denies the other allegations in paragraph 134 of the SCAC, except avers that he holds a J.D. from Harvard Law School, holds an M.B.A. from MIT's Sloan School, and holds a B.A. from Columbia College.

20

135.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 135 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Walter M. Noel, Jr., Jeffrey Tucker, Andres Piedrahita, Philip Toub, Corina Piedrahita and Yanko Della Schiava aver that Yanko Della Schiava is a son-in-law of Walter M. Noel, Jr.; and (iii) Yanko Della Schiava denies the other allegations in paragraph 135 of the SCAC. 136. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 136 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG and respectfully refer the Court to the referenced "marketing brochures" for the true and complete contents thereof; (ii) Walter M. Noel, Jr., Jeffrey Tucker, Andres Piedrahita, Yanko Della Schiava, Corina Piedrahita and Philip Toub aver that Philip Toub is a son-in-law of Walter M. Noel, Jr.; (iii) Walter M. Noel, Jr., Jeffrey Tucker and Philip Toub aver that Philip Toub holds a B.A. from Middlebury College; and (iv) Philip Toub denies the other allegations in paragraph 136 of the SCAC. 137. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 137 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG and respectfully refer the Court to the referenced "marketing materials" for the true and complete contents thereof; (ii) Jeffrey Tucker and Lourdes Barreneche aver that Lourdes Barreneche holds FINRA Series 7 and 63 licenses; and (iii) Lourdes Barreneche denies the other allegations in paragraph 137 of the SCAC, except avers that she received a Master of Arts from New York University. 138. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 138 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG and respectfully refer the Court to the 21

referenced "marketing materials" for the true and complete contents thereof; (ii) Jeffrey Tucker and Cornelis Boele aver that Cornelis Boele holds a B.A. from Clark University and holds FINRA Series 7 and 63 licenses; and (iii) Cornelis Boele denies the other allegations in paragraph 138 of the SCAC. 139. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 139 of the SCAC, except as follows: FG Defendants deny, subject to Footnote 3, the allegations regarding FGG and respectfully refer the Court to the referenced "marketing materials" for the true and complete contents thereof; and Vianney d'Hendecourt denies the other allegations in paragraph 139 of the SCAC, except avers that he holds a Bachelor of Business Administration Degree from European University in Antwerp (Belgium). 140. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 140 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Jacqueline Harary aver that Jacqueline Harary graduated from Oglethorpe University and holds FINRA series 7 and 63 licenses; and (iii) Jacqueline Harary denies the other allegations in paragraph 140 of the SCAC, except avers that she holds a B.A. from Oglethorpe University. 141. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 141 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Santiago Reyes aver that Santiago Reyes graduated from the University of Texas, holds a degree from the London School of Economics, and holds FINRA Series 7 and 63 licenses; and (iii) Santiago Reyes denies the other allegations in paragraph 141 of the SCAC, except avers that he holds a

22

B.A. from the University of Texas and holds a Master of Economic History from the London School of Economics. 142. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 142 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Julia Luongo aver that Julia Luongo received an L.L.M. in Taxation from New York University, is admitted to the bar of New York, and is a Certified Public Accountant; and (iii) Julia Luongo denies the other allegations in paragraph 142 of the SCAC, except avers that she received a B.B.A. in Accounting from Loyola College, received a J.D. from Seton Hall University, magna cum laude, where she was a law review editor, is admitted to the bar of New Jersey, and was previously employed at PricewaterhouseCoopers. 143. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 143 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Jeffrey Tucker and Harold Greisman aver that Harold Greisman received a B.A. from Tufts University and received an M.B.A. from NYU's Stern School of Business; and (iii) Harold Greisman denies the other allegations in paragraph 143 of the SCAC. 144. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 144 of the SCAC, except as follows: (i) FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; (ii) Walter M. Noel, Jr., Jeffrey Tucker, Andres Piedrahita, Yanko Della Schiava, Philip Toub and Corina Piedrahita aver that Corina Piedrahita is the wife of Andres Piedrahita; (iii) Walter M. Noel, Jr., Jeffrey Tucker, Andres Piedrahita and Corina Piedrahita aver that Corina Piedrahita is a graduate of Yale University; (iv) Walter M. Noel, Jr., Andres Piedrahita and Corina Piedrahita aver that Corina 23

Piedrahita is a U.S. citizen; and (v) Corina Piedrahita denies the other allegations in paragraph 144 of the SCAC. 145. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 145 of the SCAC, except as follows: FG Defendants deny, subject to Footnote 3, the allegations regarding FGG; and Jeffrey Tucker avers that Robert Blum graduated from the University of Pennsylvania and holds a J.D. from the University of Chicago Law School. 146. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 146 of the SCAC, except as follows: FG Defendants deny, subject to Footnote 3, the allegations regarding FGG and respectfully refer the Court to the referenced Private Placement Memorandum ("PPM") and referenced information from the Massachusetts Proceeding for the true and complete contents thereof; and Jeffrey Tucker avers that Gregory Bowes graduated from Bowdoin College. 147. FG Defendants admit that paragraph 147 of the SCAC refers to the persons

identified in paragraphs 124 through 146 collectively as the "Individual Defendants." 148. FG Defendants deny the allegations in paragraph 148 of the SCAC, except

respectfully refer the Court to the referenced exhibit from the Massachusetts Proceeding for the true and complete contents thereof. 149. 150. FG Defendants deny the allegations in paragraph 149 of the SCAC. The allegations in paragraph 150 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 150 of the SCAC, except admit that paragraph 150 of the SCAC refers to the persons and entities identified in paragraph 150 collectively as the "Fairfield Defendants"

24

and Plaintiffs have asserted claims against them for alleged negligent misrepresentation, gross negligence, breach of fiduciary duty and breach of contract.6 151. The allegations in paragraph 151 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 151 of the SCAC, except admit that paragraph 151 of the SCAC refers to the persons identified in paragraph 151 collectively as the "Fairfield Fraud Claim Defendants" and Plaintiffs have asserted alleged fraud claims against them. 152. The allegations in paragraph 152 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 152 of the SCAC, except admit that paragraph 152 of the SCAC refers to the persons identified in paragraph 152 collectively as the "Fairfield Fee Claim Defendants" and Plaintiffs have asserted only alleged fee-related claims against them. 2. 153. PricewaterhouseCoopers Defendants

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 153 of the SCAC. 154. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 154 of the SCAC, except aver, on information and belief, that PwC Canada issued unqualified audit opinions for the financial statements of the Funds for audit years 2006 and 2007. 155. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 155 of the SCAC, except deny, on information and belief,
6

Pursuant to the Court's Decision and Order dated August 18, 2010 (the "Anwar II Order"), Maria Teresa Pulido Mendoza will be treated as a "Fairfield Fee [Claim] Defendant" despite the allegations in paragraph 150 of the SCAC. No response to paragraph 150 of the SCAC is provided on behalf of LFCM. 25

that PwC Netherlands audited Greenwich Sentry, L.P. for audit year 2004, and aver, on information and belief, that PwC Netherlands issued unqualified audit opinions for the financial statements of Fairfield Sentry Limited for the audit years 2002, 2003, 2004 and 2005, and issued unqualified audit opinions for the financial statements of Fairfield Sigma Limited for audit years 2003, 2004 and 2005. 3. 156. Citco Defendants

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 156 of the SCAC. 157. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 157 of the SCAC, except aver, on information and belief, that: (i) Citco Fund Services served as the administrator, registrar and transfer agent for Fairfield Sentry Limited and Fairfield Sigma Limited since at least July 2003; (ii) Citco Fund Services served as the administrator for Greenwich Sentry, L.P. and Greenwich Sentry Partners, L.P. since at least August 2006; and (iii) Citco Fund Services had certain responsibilities to the Funds and respectfully refer the Court to the operative documents and agreements concerning Citco Fund Services for the true and complete contents thereof. 158. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 158 of the SCAC. 159. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 159 of the SCAC, except aver, on information and belief, that: (i) Citco Global Custody N.V. ("Citco Global") served as the Custodian for Fairfield Sentry Limited since at least July 2003; (ii) Citco Global served as the Custodian for Fairfield Sigma Limited since at least August 2003; (iii) in 2006, Citco Bank Nederland N.V., Dublin Branch ("Citco Bank") began to serve as Custodian for Fairfield Sentry Limited and Citco Global began 26

to serve as Depositary for Fairfield Sentry Limited; and (iv) Citco Fund Services had certain responsibilities to Fairfield Sentry Limited and Fairfield Sigma Limited and respectfully refer the Court to the operative documents and agreements concerning Citco Fund Services for the true and complete contents thereof. 160. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 160 of the SCAC, except aver, on information and belief, that: (i) Citco Bank served as the Bank for Fairfield Sentry Limited since at least July 2003; (ii) in 2006, Citco Bank began to serve as Custodian for Fairfield Sentry Limited and Citco Global began to serve as Depositary for Fairfield Sentry Limited; and (iii) Citco Bank had certain responsibilities to Fairfield Sentry Limited and Fairfield Sigma Limited and respectfully refer the Court to the operative documents and agreements concerning Citco Bank for the true and complete contents thereof. 161. The allegations in paragraph 161 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants lack knowledge or information sufficient to form a belief as to the truth of the allegations in paragraph 161 of the SCAC, except FGBL avers that it paid Citco Fund Services (Bermuda) Limited ("CFSB") for certain services and respectfully refers the Court to the operative documents and agreements concerning CFSB for the true and complete contents thereof. 162. FG Defendants admit that paragraph 162 of the SCAC refers to the entities

identified in paragraph 162 collectively as "Citco." 163. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 163 of the SCAC, except FGBL avers that Brian Francoeur served as a director of FGBL for a certain period of time and respectfully refers the Court to the referenced PPM for the true and complete terms thereof. 27

164.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 164 of the SCAC, except FGBL denies that Ian Pilgrim was a director of FGBL during each year of the time period 2003 to 2005. 4. 165. GlobeOp Defendant

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 165 of the SCAC, except aver, on information and belief, that GlopeOp Financial Services, LLC ("GlobeOp") served as the Administrator of Greenwich Sentry, L.P. for a period of time ending August 2006 and had certain responsibilities to Greenwich Sentry, L.P. and respectfully refer the Court to the operative documents and agreements for the true and complete contents thereof. ALLEGATIONS OF FACT A. 166. Bernard Madoff's Massive Ponzi Scheme FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 166 of the SCAC, except aver, on information and belief, that BMIS and Bernard L. Madoff (collectively with BMIS, "Madoff") perpetrated a fraudulent scheme and aver that FG Defendants had no knowledge of the fraud prior to December 11, 2008. 167. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 167 of the SCAC, except aver, on information and belief, that Madoff was arrested, charged and is currently serving a prison sentence, and respectfully refer the Court to the referenced criminal complaint and relevant sentencing documents for the true and complete contents thereof. B. 168. Fairfield Greenwich Group's Relationship with Madoff FG Defendants deny, subject to Footnote 3, the allegations in paragraph 168 of

the SCAC, except aver, on information and belief, that certain businesses were in operation in or 28

about 1983 that came to be referred to under the marketing name FGG and that Andres Piedrahita has been referred to as a "founding partner" of FGG. 169. FG Defendants deny the allegations in paragraph 169 of the SCAC, except aver,

on information and belief, that Madoff purported to execute a split-strike conversion strategy on behalf of the Funds and that Madoff served as a custodian or sub-custodian for a substantial portion of the Funds' assets. 170. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 170 of the SCAC, except aver, on information and belief, that: (i) Fairfield Sentry Limited was incorporated in 1990 as an international business company in the Territory of the British Virgin Islands ("BVI"); (ii) Madoff purported to execute a splitstrike conversion strategy on behalf of Fairfield Sentry Limited; (iii) Madoff served as a custodian or sub-custodian for a substantial portion of Fairfield Sentry Limited's assets; (iv) Fairfield Sentry Limited was created primarily for foreign investors; (v) investments in Fairfield Sentry Limited were made from outside New York; and (vi) on July 21, 2009, the BVI Court ordered that Fairfield Sentry Limited be liquidated and appointed Kenneth Krys and Christopher Stride as the liquidators of Fairfield Sentry Limited. 171. FG Defendants deny the allegations in paragraph 171 of the SCAC, except aver,

on information and belief, that: (i) Fairfield Sigma Limited was an international business company organized under the laws of the BVI; (ii) Fairfield Sigma Limited was invested in Fairfield Sentry Limited and, during the period of such investment, Madoff served as subcustodian for a substantial portion of Fairfield Sentry Limited's assets; (iii) Fairfield Sigma Limited was created for foreign investors; (iv) investments in Fairfield Sigma Limited were made from outside New York; and (v) on July 21, 2009, the BVI Court ordered that Fairfield Sigma Limited be liquidated and appointed Kenneth Krys and Christopher Stride as the 29

liquidators of Fairfield Sigma Limited, and respectfully refer the Court to the referenced PPM for the true and complete terms thereof. 172. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 172 of the SCAC, except aver, on information and belief, that: (i) Greenwich Sentry, L.P. is a Delaware limited partnership organized December 27, 1990 under the name Aspen/Greenwich Limited Partnership; (ii) Aspen/Greenwich Limited Partnership changed its name to Greenwich Sentry, L.P. on December 4, 1992; (iii) operations commenced under the name Greenwich Sentry, L.P. on January 1, 1993; (iv) Madoff purported to execute a split-strike conversion strategy on behalf of Greenwich Sentry, L.P.; (v) Madoff served as a custodian for a substantial portion of Greenwich Sentry, L.P.'s assets; and (vi) Greenwich Sentry, L.P. was created for United States investors and sold limited partnership interests to United States investors, including investors in New York. 173. FG Defendants deny the allegations in paragraph 173 of the SCAC, except aver,

on information and belief, that: (i) Greenwich Sentry Partners, L.P. is a Delaware limited partnership, was organized on April 11, 2006, commenced operations on May 1, 2006 and is registered to do business in New York; (ii) Madoff purported to execute a split-strike conversion strategy on behalf of Greenwich Sentry Partners, L.P.; (iii) Madoff served as a custodian for a substantial portion of Greenwich Sentry Partner, L.P.'s assets; and (iv) Greenwich Sentry Partners, L.P. was created for United States investors and limited partnership interests were sold to United States investors, including investors in New York. 174. FG Defendants admit that paragraph 174 of the SCAC refers to the funds

identified in paragraphs 169 through 173 collectively as the "Funds."

30

175.

FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 175 of the SCAC, except respectfully refer the Court to the referenced SEC complaint for the true and complete contents thereof. C. 176. Nature and Structure of the Fairfield Greenwich Group The allegations in paragraph 176 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny, subject to Footnote 3, the allegations in paragraph 176 of the SCAC. 177. The allegations in paragraph 177 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny, subject to Footnote 3, the allegations in paragraph 177 of the SCAC. 178. The allegations in paragraph 178 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny, subject to Footnote 3, the allegations in paragraph 178 of the SCAC. 179. FG Defendants deny, subject to Footnote 3, the allegations in paragraph 179 of

the SCAC, except respectfully refer the Court to the referenced brochure for the true and complete contents thereof. 180. D. 181. FG Defendants deny the allegations in paragraph 180 of the SCAC. Fairfield Defendants' False Representations and Omissions in Marketing the Funds and Their Breaches of Fiduciary Duties to Investors The allegations in paragraph 181 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 181 of the SCAC, except aver, on information and belief, that certain investors or their nominees were provided certain PPMs and Confidential Offering Memoranda ("COM") and that certain website information was available to investors, and respectfully refer 31

the Court to the relevant documents and website information for the true and complete content thereof. 182. The allegations in paragraph 182 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 182 of the SCAC. 183. The allegations in paragraph 183 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 183 of the SCAC and respectfully refer the Court to the referenced documents and marketing materials for the true and complete contents thereof. 1. 184. Defendants' False Representations and Omissions Regarding the Split-Strike Conversion Strategy

FG Defendants deny the allegations in paragraph 184 of the SCAC, except aver

that the strategy of the Funds was described as including a "split-strike conversion" strategy and respectfully refer the Court to the referenced PPMs and COMs for the true and complete terms thereof. 185. FG Defendants deny the allegations in paragraph 185 of the SCAC, except aver,

on information and belief, that Madoff perpetrated a Ponzi scheme and aver that FG Defendants had no knowledge of the fraudulent scheme prior to December 11, 2008. 186. The allegations in paragraph 186 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 186 of the SCAC.

32

2. 187.

Defendants' False Representations and Omissions Regarding the Funds' Track Record of Profitability

FG Defendants deny the allegations in paragraph 187 of the SCAC, except

respectfully refer the Court to the referenced PPMs and "update reports" for the true and complete contents thereof. 188. FG Defendants lack knowledge or information sufficient to form a belief as to the

truth of the allegations in paragraph 188 of the SCAC, except aver, on information and belief, that information Madoff reported on returns was false. 189. The allegations in paragraph 189 of the SCAC state legal conclusions to which no

response is required. To the extent that a response is required, FG Defendants deny the allegations in paragraph 189 of the SCAC. 3. 190. Defendants' False Representations and Omissions in Fund Reports to Investors

FG Defendants deny the allegations in paragraph 190 of the SCAC, except

respectfully refer the Court to the referenced reports for the true and complete contents thereof. 191. FG Defendants deny the allegations in paragraph 191 of the SCAC, except

respectfully refer the Court to the referenced Semi-Annual Reports and Monthly Strategy Reviews for the true and complete contents thereof. 192. FG Defendants deny the allegations in paragraph 192 of the SCAC. 4. 193. 194. Defendants' False Representations and Omissions Concerning Due Diligence and Oversight of Madoff

FG Defendants deny the allegations in paragraph 193 of the SCAC. FG Defendants deny the allegations in paragraph 194 of the SCAC, except

respectfully refer the Court to the referenced PPMs for the true and complete terms thereof.

33

195.

FG Defendants deny the allegations in paragraph 195 of the SCAC, except

respectfully refer the Court to the referenced PPMs for the true and complete terms thereof. 196. FG Defendants deny the allegations in paragraph 196 of the SCAC, except aver

that certain FG Defendants conducted substantial due diligence and respectfully refer the Court to the referenced documents for the true and complete terms thereof. 197. FG Defendants deny the allegations in paragraph 197 of the SCAC, except

respectfully refer the Court to the referenced document for the true and complete contents thereof. 198. FG Defendants deny the allegations in paragraph 198 of the SCAC, except aver

that certain FG Defendants conducted substantial due diligence and respectfully refer the Court to the referenced document for the true and complete contents thereof. 199. FG Defendants deny the allegations in paragraph 199 of the SCAC, except

respectfully refer the Court to the referenced document for the true and complete contents thereof. 200. FG Defendants deny the allegations in paragraph 200 of the SCAC, except

respectfully refer the Court to the referenced documents for the true and complete contents thereof. 201. FG Defendants deny the allegations in paragraph 201 of the SCAC, except

respectfully refer the Court to the referenced document for the true and complete contents thereof. 202. FG Defendants deny the allegations in paragraph 202 of the SCAC, except

respectfully refer the Court to the referenced documents for the true and complete contents thereof.

34

203.

FG Defendants deny the allegations in paragraph 203 of the SCAC, except

respectfully refer the Court to the referenced document for the true and complete contents thereof. 204. FG Defendants deny the allegations in paragraph 204 of the SCAC, except

respectfully refer the Court to the referenced document for the true and complete contents thereof. 205. 206. 207. FG Defendants deny the allegations in paragraph 205 of the SCAC. FG Defendants deny the allegations in paragraph 206 of the SCAC. FG Defendants deny the allegations in paragraph 207 of the SCAC, except

respectfully refer the Court to the referenced emails for the true and complete contents thereof. 208. FG Defendants deny the allegations in paragraph 208 of the SCAC, except

respectfully refer the Court to the referenced email for the true and complete contents thereof. 209. FG Defendants deny the allegations in paragraph 209 of the SCAC, except

respectfully refer the Court to the referenced email for the true and complete content thereof. 210. 211. FG Defendants deny the allegations in paragraph 210 of the SCAC. FG Defendants deny the allegations in paragraph 211 of the SCAC, except aver

that they did not contact the counterparties regarding Madoff's trades. 212. 213. 214. FG Defendants deny the allegations in paragraph 212 of the SCAC. FG Defendants deny the allegations in paragraph 213 of the SCAC. FG Defendants deny the allegations in paragraph 214 of the SCAC, except

respectfully refer the Court to the referenced Consent Order for the true and complete contents thereof. 215. 216. FG Defendants deny the allegations in paragraph 215 of the SCAC. FG Defendants deny the allegations in paragraph 216 of the SCAC. 35

E. 217.

The Fairfield Defendants Ignored Red Flags of Madoff's Fraud FG Defendants deny the allegations in paragraph 217 of the SCAC. 1. Madoff's Secretive Operations

218.

FG Defendants deny the allegations in paragraph 218 of the SCAC, except

respectfully refer the Court to the referenced memorandum for the true and complete contents thereof. 219. FG Defendants deny the allegations in paragraph 219 of the SCAC. 2. 220. Key Positions Held by Madoff Family Members

FG Defendants deny the allegations in paragraph 220 of the SCAC. 3. Madoff's Custody of Assets

221.

FG Defendants deny the allegations in paragraph 221 of the SCAC, except aver

that Madoff served as a custodian or sub-custodian for a substantial portion of the Funds' assets. 4. 222. Madoff's Unknown Auditing Firm

FG Defendants deny the allegations in paragraph 222 of the SCAC,