Filing a complaint is easy. And when lawyers are chasing $50 billion in losses, an enormous amount of lawsuits will follow. Who are the most obvious targets? It will undoubtedly be the Madoff “feeder” funds and other referral sources including brokerage firms, accountants, lawyers, investment managers and advisors.
Whether your organization is a “feeder fund” or investment advisor, the next question becomes: will your directors and officers (“D&O”) or professional liability (“E&O”) insurance policy protect you from these actions?
There are other policies that may provide protection including (without limitation): Financial Institutions (fidelity) Bonds, fiduciary insurance, CGL policies, SIPC “coverage”, General Partners Liability coverage, etc.
But these two policies, D&O and Professional Liability are your most likely sources of coverage protection.