Morgan Stanley, Citigroup Clients Said to Invest in Madoff Fund

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more: http://www.bloomberg.com/apps/news?pid=20601087&sid=aPGwNAZOekuY&refer=home

Morgan Stanley, Citigroup Clients Said to Invest in Madoff Fund
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By Christine Harper

Jan. 16 (Bloomberg) -- Morgan Stanley and Citigroup Inc., which are forming a venture to be the largest investment adviser to individuals, had $1.8 billion of clients’ cash in a fund that invested with Bernard Madoff, said two people familiar with the matter.

The money was in an $8 billion fund run by Switzerland’s Union Bancaire Privee, which gave $700 million to Madoff, one person said. Morgan Stanley has advised clients, who it said lost $95 million of their $1.1 billion investment, to redeem their money and has taken the UBP fund off its recommended investments list. Citigroup advised its clients, who had about $720 million at UBP, to redeem their cash, a person said.

Morgan Stanley, which lost 70 percent of its market value last year, is seeking to build its business of providing investment advice to individuals and reduce its dependence on trading and investment banking.

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1. LOL. The wizards turn themselves into toads. nt