Bank Hapoalim to pay $9.5 million to settle Madoff-related lawsuits
Israeli bank reaches agreement tied to investments routed through its Swiss subsidiary.
Bank Hapoalim has signed a settlement agreement with the liquidators of the funds Bernard L. Madoff Investment Securities and Fairfield Sentry Ltd under which it will pay approximately $9.5 million (nearly NIS 30 million) to compensate investors connected to the collapsed funds.
The settlement stems from lawsuits filed against Bank Hapoalim and other banks in August 2010 by the liquidators of Fairfield Sentry, a feeder fund that invested most of its assets with Bernie Madoff. The lawsuits sought the return of funds allegedly withdrawn before the collapse of Madoff’s investment operation.
The activity in question was conducted through Bank Hapoalim Switzerland, the bank’s Swiss private banking subsidiary, which was closed in July 2023. One of the lawsuits sought approximately $31 million from the bank. In August 2025, a U.S. federal appeals court dismissed that case, but the liquidators later appealed the ruling.
A separate lawsuit was filed in March 2012 by the liquidator of Madoff’s investment firm, seeking an additional $22 million from Bank Hapoalim and its Swiss subsidiary under similar claims. In September 2022, a motion by the bank to dismiss the case was denied.
Bank Hapoalim’s management, led by CEO Yadin Antebi, ultimately chose to settle the litigation. The agreement requires the bank to pay less than one-third of the combined claims brought against it.
The Madoff investment scandal is widely regarded as one of the largest financial frauds of the modern era. Madoff operated what authorities described as a massive Ponzi scheme, using money from new investors to pay returns to existing clients.
Madoff marketed his funds as employing a sophisticated investment strategy capable of generating stable annual returns of roughly 10% with minimal volatility. In reality, according to U.S. authorities, few if any legitimate investments were made for years, and investor payouts were financed primarily through incoming deposits from new clients.
The fraud collapsed in December 2008, when investors sought to redeem their funds and Madoff was unable to meet withdrawal requests. At its peak, the operation reportedly managed approximately $65 billion in client assets, while estimated investor losses totaled around $18 billion. Madoff died in prison in April 2021.
Fairfield Sentry was among the largest victims of the scheme because it had invested most of its capital with Madoff. Bank Hapoalim Switzerland served wealthy private clients and high-net-worth families, some of whom invested in Madoff-linked funds through the bank.
Following the collapse of the fraud, court-appointed trustee Irving Picard launched legal actions against banks, investment funds and investors worldwide, arguing that they had received “subsequent transfers” originating from the fraudulent operation and should therefore return those funds.
