Anwar et al v. Fairfield Greenwich Limited et al

Filing 787

DECLARATION of Savvas A. Foukas in Opposition re: #775 FIRST MOTION to Certify Class.. Document filed by PricewaterhouseCoopers Accountants Netherlands N.V., Pricewaterhousecoopers L.L.P.. (Attachments: #1 Exhibit A, #2 Exhibit B, #3 Exhibit C, #4 Exhibit D, #5 Exhibit E, #6 Exhibit F, #7 Exhibit G, #8 Exhibit H, #9 Exhibit I, #10 Exhibit J, #11 Exhibit K, #12 Exhibit L, #13 Exhibit M, #14 Exhibit N, #15 Exhibit O, #16 Exhibit P, #17 Exhibit Q, #18 Certificate of Service)(Maguire, William)

Exhibit C

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF NEW YORK
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PASHA S. ANWAR, et al.,

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Plaintiffs,
Civil Action No.
09-CV-0118(VM)

vs.

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FAIRFIELD GREENWICH LIMITED, et al.,

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Defendants.
------------------------------------x

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VIDEOTAPED DEPOSITION OF DUNCAN POLLOCK

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New York, New York

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July 19, 2011

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Reported by:

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KATHY S. KLEPFER, RMR, RPR, CRR, CLR

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JOB NO. 39763

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D. Pollock
that, I had the impression, that impression,
when we first made the investment in Fairfield
Investment Fund.
Q. But you never reviewed an annual audit
report for the Fairfield Sigma fund?
A. I don't recall doing so.
MR. STEWART: Counsel, what points in
time are you talking about? Anytime?
MS. PIERCE: At any time.
THE WITNESS: I don't recall looking
at a specific audit, but the fact that there
was an audit gives one -- gave me, gave us,
more confidence in the firm overall.
BY MS. PIERCE:
Q. Prior to your first decision to invest
in the Fairfield funds, the -- your first
investment in Fairfield Greenwich Group in the
two funds, you did not have any contact with
PricewaterhouseCoopers (Netherlands) with
respect to that first investment in those two
Fairfield funds, did you?
A. No, I did not.
Q. So you didn't speak to anyone at
PricewaterhouseCoopers (Netherlands) concerning

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D. Pollock
that investment?
A. I did not.
Q. And you did not request any materials
from PwC (Netherlands) with respect to that
investment?
A. I did not.
Q. Are you aware whether anyone else
associated with St. Stephen's School had any
communications with PricewaterhouseCoopers
(Netherlands) with respect to that initial
investment?
A. I'm unaware of anyone else.
Q. Okay. So now let's switch to your
investment or your decision to switch the
investment to Fairfield Sigma in 2005.
Prior to the decision to switch to
Fairfield Sigma, did you have any contact with
PricewaterhouseCoopers (Netherlands) with
respect to that decision?
A. I did not.
Q. So you did not speak to anyone at
PricewaterhouseCoopers (Netherlands) concerning
your decision to switch the investment -A. I did not.

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D. Pollock
Q. -- to Fairfield Sigma?
A. Did not.
Q. You did not request any materials from
PricewaterhouseCoopers (Netherlands) with
respect to your decision to switch the
investment to Fairfield Sigma; is that correct?
A. That's correct.
Q. Are you aware whether anyone else
associated with St. Stephen's School would have
contacted PricewaterhouseCoopers (Netherlands)
with respect to that decision to switch the
investment to Fairfield Sigma?
A. I don't think anyone else would have
been in touch.
Q. Now moving on to the subsequent
investment that you made of additional funds in
Fairfield Sigma in 2006, with respect to that
subsequent investment, prior to your decision to
make that subsequent investment, did you discuss
that decision with anyone at
PricewaterhouseCoopers (Netherlands)?
A. I did not.
Q. Did you request any materials from
PricewaterhouseCoopers (Netherlands) with

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D. Pollock
respect to your decision to make that subsequent
investment?
A. I did not.
Q. Do you recall reviewing any materials
from PricewaterhouseCoopers (Netherlands) with
respect to making that subsequent investment in
2006?
A. I don't recall.
Q. Are you aware whether anyone else
associated with St. Stephen's School would have
had any contact with PricewaterhouseCoopers
(Netherlands) with respect to that subsequent
investment in Fairfield Sigma?
A. I'm unaware of any other contact.
Q. I just want to make sure I'm clear on
the record. Prior to your initial decision to
invest in Fairfield Greenwich Group funds, you
do not remember receiving any materials from
PricewaterhouseCoopers (Netherlands); is that
correct?
A. That's correct.
Q. And prior to your decision to switch
your investment to Fairfield Sigma, you do not
remember reviewing any materials from

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PricewaterhouseCoopers (Netherlands)?
A. That's correct.
Q. I'd like to ask you some questions
about your understanding regarding St. Stephen's
School's role in the structure of the Fairfield
Sigma Fund. What did you understand that role
to be? Were you -- did you understand St.
Stephen's School to be a shareholder?
A. Yes.
Q. Do you know approximately how many
other shareholders there were in Fairfield
Sigma?
A. No, I never knew.
Q. Did you know any of the other
shareholders in Fairfield Sigma?
A. No.
Q. Did you know the identity of any of
the other shareholders in Fairfield Sigma?
A. I did not.
Q. Did you ever attend any meetings in
your capacity as a shareholder in Fairfield
Sigma?
A. I did not.
Q. I'd like you to take a look at Exhibit

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D. Pollock
26. Do you have that there in front of you?
A. I do.
Q. Let's look first at number 4, where
you declared that, "In deciding to make and hold
our investment in the fund," you reviewed and
relied upon a variety of documents provided by
defendants, including a prospectus.
Would it be correct to say that you
did not rely on anything from
PricewaterhouseCoopers (Netherlands) with
respect to number 4?
A. I think that's probably true.
Q. And -MR. STEWART: Counsel, could you
clarify? Are you speaking about documents
or oral communications directly with
Pricewaterhouse, or are you speaking about
documents that might have been incorporated
into materials that Fairfield Greenwich
might have provided to investors such as St.
Stephen's School?
MS. PIERCE: I'll try to ask a
question that will clarify.
MR. STEWART: If you could.

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BY MS. PIERCE:
Q. So with respect to number 4, in
deciding to make and hold your investment in
Fairfield Sigma, you do not recall reviewing or
relying upon any documents provided to you by
PricewaterhouseCoopers (Netherlands); is that
correct?
A. That's correct.
Q. And you do not recall receiving from
Fairfield Greenwich Group any documents from
PricewaterhouseCoopers (Netherlands), is that
also correct?
A. That's correct.
Q. Okay. Now, with respect to number 5,
where you say that you also reviewed documents
posted on the Fairfield Greenwich Group Website,
including annual reports on the fund's
performance and documents concerning FGG's due
diligence practices, is it correct that in
accessing Fairfield Greenwich Group's Website,
you did not review any audited financial
statements for Fairfield Sigma?
A. You know, I can't answer that with
certainty. I had access to, you know, the

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D. Pollock
detailed fund information, and I can't remember
exactly what was on there, but I can say that
knowing that there was an annual audit was an
important element.
Q. Just to confirm, you've testified
today your knowledge that there was an annual
audit was based on materials you received from
Fairfield Greenwich Group?
A. Correct.
Q. And that knowledge was based on
representations in those materials?
A. Correct.
Q. Just one second.
(Pause.)
Q. I think I have just one last question
or maybe just a couple of final questions.
You never -- is it correct that you
never relied upon any representations by
PricewaterhouseCoopers (Netherlands) that
Fairfield Sigma was going to invest, and
actually was investing, St. Stephen's' money in
securities?
A. I never had any direct communication
with Pricewaterhouse.

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MS. PIERCE: Okay. I think that's all
the questions that I have. Thank you.
EXAMINATION BY
MR.S CRAWFORD:
Q. Hi, Mr. Pollock. My name is Amy
Crawford and I'm from the law firm of Kirkland &
Ellis. We represent PricewaterhouseCoopers
(Canada). I'm going ask you some similar
questions, likely, but hopefully not too long,
okay?
A. (Witness nods.)
Q. Reminder you've got to give verbal
answers to my questions.
A. Okay.
Q. Okay. Now, earlier you testified that
the subscription agreement that you executed for
Fairfield Sigma was dated roughly September of
2005. Do you recall that?
A. Yes. I don't recall the exact date,
but I mean, the initial transfer of funds; is
that what you're referring to?
Q. Right.
A. From FIF to Fairfield Sigma? Yes.
Q. Right.

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D. Pollock
A. That sounds -- sounds right.
Q. And there was a subsequent transfer of
funds to Fairfield Sigma, correct?
A. Yes, about 100,000 euro.
Q. And that took place on September 28,
2006. Do you recall seeing that in the short
form subscription agreement?
A. I do. I do. I'm not sure of the
date, but I remember seeing the subscription.
Q. And the date on the subscription
agreement was correct, right?
A. Yes.
Q. Let's actually just take a look at it.
It's Exhibit 18.
A. Okay.
Q. On the second page, see St. Stephens
78. Are you there?
A. Yes.
Q. And the contribution date on Stephens
78 is September 28, 2006, do you see that?
A. I do.
Q. And that date is the last date that
St. Stephen's made a contribution to Fairfield
Sigma, correct?

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Yes.
MR. STEWART: Counsel, just so the
record is clear, that's the date that he
executed the subscription agreement. It may
or may not be the date when funds were
actually transferred, which would I think be
the contribution date, whatever that may be.
Q. Let me put it this way, Mr. Pollock.
You decided or St. Stephen's School decided to
make a contribution to Fairfield Sigma on
September 28, 2006, right?
A. Correct.
Q. Whether or not funds were transferred
a month or two later, right?
A. Right.
Q. Now, you testified earlier that it
gave you comfort that Fairfield Greenwich Group
was audited, do you remember that?
A. I do.
Q. And you said that you learned from
Fairfield Greenwich Group that they were audited
before you invested in -- before St. Stephen's
School invested in FIF, right?
A. Correct.
A.

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D. Pollock
Q. And do you know who the auditor of
Fairfield Greenwich Group was?
A. I don't remember the name.
Q. And do you remember the name of the
auditor of any of the Fairfield Greenwich funds?
A. No.
Q. And were you aware of any of the funds
changing auditors at any point in time while St.
Stephen's School had invested in the funds?
A. I think that there was a change in
auditor for the Iron Gate Global Strategy Fund
with they ran into trouble, but I'm not sure of
that. And I don't recall any other changes.
Q. And do you recall the names of the
auditors involved in Fairfield Iron Gate?
A. No, I don't.
Q. So you have no idea whether PwC
(Canada) ever audited Fairfield Sigma, is that
right?
A. That's right.
Q. Fair to say you didn't rely on
anything that PwC (Canada) did in making the
decision to invest?
MR. STEWART: Objection.

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D. Pollock
Mischaracterizes the witness's testimony.
MS. CRAWFORD: I'm not attempting to
characterize his testimony. I'm just asking
him a question.
Q. So you can answer.
A. Could you ask that again, please?
Q. Sure. Is it fair to say you didn't
rely on anything PwC (Canada) did in making the
decision to invest?
A. One of the elements that I relied on
was the assurance that, from Fairfield Greenwich
Group, the assurance that there was an annual
audit conducted.
Q. Okay. So it was Fairfield Greenwich
Group's assurance that Fairfield Greenwich Group
itself was audited; is that right?
A. Correct.
Q. You didn't actually ever see any
documents from PricewaterhouseCoopers (Canada),
did you?
A. I don't recall any documents.
Q. I believe you testified earlier that
you don't have any recollection of reading an
audit report?

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A. Correct.
Q. For any of the funds?
A. Correct.
Q. Did you ever meet with anyone at PwC
(Canada) before you invested?
A. I did not.
Q. Or after St. Stephen's School
invested?
A. I did not.
Q. Did you ever speak with anyone at PwC
(Canada) before or after St. Stephen's School
invested?
A. I did not.
Q. Did you receive any representations
from PwC (Canada) with respect to Fairfield
Sigma?
A. I did not.
Q. Did you receive any representations
from PwC Canada about Bernard Madoff?
A. I did not.
Q. I believe you testified earlier that
everything that you reviewed after you invested
was either sent via e-mail or fax from Fairfield
Greenwich Group or Citco; is that correct?

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A. Correct. Or I could access -- you
know, I had a passcode. I could access more
detailed fund information through Fairfield
Greenwich Website.
Q. Understood.
Are you still the chair of the
Investment Committee?
A. I am. I don't know why they haven't
thrown me off.
Q. It sounds like a thankless task, I
have to say.
A. It sure is.
Q. What is St. Stephen's School investing
in now?
A. We have -- we -- we did a review of
several investment firms and selected Morgan
Stanley to handle our endowment, and we have two
accounts set up with Morgan Stanley.
Q. Do you know who Morgan Stanley's
auditor is?
A. I don't.
Q. Or who audits any of the funds that
you invested in through Morgan Stanley?
A. Well, we don't invest. We have their

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managers make the direct investments in fixed
income securities or in stocks. There's no fund
involved. They do the investments themselves.
Q. Okay. And you have never received
anything referencing PricewaterhouseCoopers
(Canada), have you?
A. No.
Q. After Bernard Madoff was arrested in
December of 2008, did St. Stephen's School
attempt to withdraw funds from Fairfield Sigma?
A. Well, I immediately got in touch with
Fairfield Greenwich Group and, you know, to see
if there was, you know, money we could draw out,
and the whole place was in chaos and our
representative was gone, you know.
Q. Are you aware of anyone who
successfully withdrew funds after Bernard Madoff
was arrested?
A. No.
Q. If Madoff's Ponzi scheme had been
revealed prior to December 11, 2008, do you have
any reason to believe that you could have
recovered your investment?
A. I just -- I don't know. You know,

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that's -Q. If you hadn't invested with Fairfield
Sigma, where would you have invested St.
Stephen's School endowment?
MR. STEWART: Objection. Calls for
speculation.
A. Well, I could say that we did invest
additional money in Iron Gate Strategy Fund and
we looked at a number of different funds.
Q. Other funds within Fairfield Greenwich
Group?
A. Within Fairfield, yes.
Q. All right. I'm going to ask you a
couple of questions that are going to
potentially sound a little silly, okay? All
right?
A. That won't be the only ones.
Q. St. Stephen's School is located in
Rome, Italy, right?
A. Correct.
Q. And so all of the educational activity
that -- the education of students happens in
Italy?
A. It does.

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Q. You said there was only one part-time
employee in New York?
A. Yes.
Q. And I take it the Board of Trustees is
a volunteer board?
A. It is.
Q. Does St. Stephen's School pay taxes in
Italy?
A. I think we do.
Q. What's your understanding of what a
Ponzi scheme is?
A. You take money from one person and -and you spend it and give it back to somebody
else. You don't -- you don't invest it.
Q. So some people who invested in Madoff
were paid, quote/unquote, profits that really
weren't profits at all; is that your
understanding?
A. That's what I've read, yes.
Q. Did you -- now, St. Stephen's School
didn't redeem any of its investment, right?
A. Not a dime.
Q. But you understand that potentially
some people who invested in Fairfield Sigma or

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other funds may have taken out more than they
put in?
A. Correct. That's what I've read.
Q. So your money was used to pay off
others in the scheme?
A. That's what seems to have happened.
Q. So others would need to invest, then,
in order to pay St. Stephen's School off if it
were to try to redeem its investments, right?
A. That's my understanding.
Unfortunately, we didn't redeem our shares.
Q. Some people might even be -- might
even have lost money in the scheme yet have
withdrawn some of the money that they -- that
they had invested, right?
A. Could you say that again?
Q. Some people might have lost money,
like you, but have lost less than you because
they redeemed part of their investment?
A. I suppose that's true.
MR. STEWART: Counsel, I'm going to
object to this whole line of questioning.
It's speculative. It's irrelevant to the
experience of St. Stephen's School. I don't

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know where you're going with it or why, but
you can certainly continue a while longer if
you must.
MS. CRAWFORD: You can refrain from
the speaking objections and I'll just ask a
couple more questions.
BY MS. CRAWFORD:
Q. So you might be entitled -- St.
Stephen's School might be entitled to receive
compensation from somebody who lost some money
but didn't lose nearly as much as St. Stephen's
School because they withdrew from Fairfield
funds before the scheme was revealed?
MR. STEWART: Objection.
Q. Right?
MR. STEWART: Calls for a legal
conclusion. I object.
THE WITNESS: Our only interest is in
getting as much of our money, endowment
money back as possible.
BY MS. CRAWFORD:
Q. And it's not fair for some people to
have taken money out of the scheme when St.
Stephen's School lost all of its money, right?

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A. I got to go back to that. Yes.
Q. Towards the bottom, it talks about the
split-strike conversion strategy, and it
indicates in the PPM that the strategy is
implemented by Bernard L. Madoff Investment
Securities, BLM, through accounts maintained at
that firm.
Does this refresh your recollection
that you learned about Mr. Madoff's involvement
in the Fairfield Sigma Fund at the time that you
received this e-mail from Mr. Norton with the
attached offering memorandum?
MR. STEWART: I'm going to object for
lack of foundation. The witness already
testified that he never read this document.
A. I don't recall this document.
Q. But at some point in time you did find
out, you did have some inkling that Mr.
Madoff -A. Right.
Q. -- was involved with the fund?
A. Right.
Q. And this document does provide
information that --

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A. Yeah, but you know this document still
doesn't -- doesn't spell out to what extent he's
involved.
Q. Right, but my question to you, and
please allow me to finish my question -- I'll
give you the courtesy of allowing you to finish
your answer -- this document does indicate that
Mr. Madoff was involved in some fashion with the
Fairfield Sigma Fund, correct?
A. This document seems to indicate that
he was involved.
Q. And you do not recall sitting here
today whether this is the document that gave you
that knowledge or that inkling that you spoke of
before that Mr. Madoff was involved in the
Fairfield Fund?
(Continued on the next page to include
the jurat.)

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No, I don't recall this document.
MS. FEINBERG: No further questions.
THE VIDEOGRAPHER: That concludes the
video record for today. The time is now
6:29 P.M. We are now off the record.
oOo
A.

____________________
DUNCAN POLLOCK
Subscribed and sworn to
before me this day
of
2011.

_______________________
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D. Pollock
CERTIFICATE
STATE OF NEW YORK )
: ss
COUNTY OF NEW YORK)
I, Kathy S. Klepfer, a Registered
Merit Reporter and Notary Public within and
for the State of New York, do hereby
certify:
That DUNCAN POLLOCK, the witness whose
deposition is herein before set forth, was
duly sworn by me and that such deposition is
a true record of the testimony given by such
witness.
I further certify that I am not
related to any of the parties to this action
by blood or marriage and that I am in no way
interested in the outcome of this matter.
In witness whereof, I have hereunto
set my hand this 25th day of July, 2011.
------------------------------KATHY S. KLEPFER, RPR, RMR, CRR, CLR

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