Some of the world's biggest banking institutions and hedge funds reported potential huge losses on Monday as the impact of alleged fraud by arrested Wall Street investment manager Bernard Madoff spread far beyond U.S. borders. Britain's Royal Bank of Scotland Group PLC and Man Group PLC, Spain's Grupo Santander SA, France's BNP Paribas and Japan's Nomura Holdings all reported that they had fallen victim to Madoff's alleged $50 billion Ponzi scheme. The extent of the potential damage, stretching also to several U.S. charities who invested funds, prompted a leading fund manager in London to lash out at US regulators for failing to detect the fraud earlier. “I think now it is very difficult for people to invest in things that are meant to be regulated in America, because they haven fallen down in the job,” Nicola Horlick, the manager of Bramdean Alternatives, which has 9 percent of its funds invested in Madoff's scheme, told the British Broadcasting Corp. “All through the credit crunch this has been apparent,” Horlick added. “This is the biggest financial scandal, probably, in the history of the markets.” Man Group, the world's largest publicly traded fund manager that reported exposure of around $360 million on Monday, said “it appears that a systematic and comprehensive fraud may have been committed, evading a range of structural controls.” Around the world, investors who put cash into veteran Wall Street money manager Madoff's investment pool spent the weekend calculating how much exposure they might have. The 70-year-old Madoff, who had served as chairman of the Nasdaq Stock Market, was arrested Thursday in what prosecutors say was a scheme to defraud investors. Alleged victims span from the super rich to pensioners, powerful financial institutions to local charities. Some investors claim they've been wiped out, while others are still likely to come forward. Among those confirming exposure on Monday, Banco Santander, the largest bank in the euro zone by market capitalization, said its clients have ¤2.33 billion ($3.07 billion) in exposure with Madoff, mostly through a fund called Optimal Strategic US Equity. Banco Santander said it has another position of 17 million of its own money through another fund which it did not name. Royal Bank of Scotland - Britain's second-largest bank, which is now 58 percent owned by the British government - said it could lose around £400 million pounds ($600 million) through exposure in trading and collateralized lending to funds of hedge funds invested with Bernard L Madoff Investment Securities LLC. Nomura Holdings said it has 27.5 billion yen ($306 million) in exposure, but added that any losses were likely to be limited compared to its capital base. Man Group, the world's largest publicly traded hedge fund manager, said its risk came through two funds that are directly or indirectly sub-advised by Madoff Securities through RMF, its predominantly institutional fund of funds. “RMF will continue to monitor and evaluate the situation on behalf of its investors and will take appropriate steps to seek recovery of investor assets,” Man Group said in a statement. The new reports follow statements on Sunday from Switzerland's Reichmuth and amp; Co. that the private bank has $327 million at risk and from BNP Paribas that estimated its exposure at ¤350 million. The assets of Bernard L. Madoff Investment Securities LLC were frozen Friday in a deal with federal regulators and a receiver was appointed to manage the firm's financial affairs. - APBritain: Man Group investment fund says it could lose $360 million. Royal Bank of Scotland says it could lose £400 million ($599 million). HSBC banking giant had potential exposure of $1 billion, the Financial Times reports. France: BNP-Paribas retail bank estimates possible loss at €350 million($472 million). Natixis investment bank said it could lose up to €450 million. Societe Generale says its possible losses are below €10 million. Axa insurance firm says its potential losses are below €100 million. Credit Agricole says its losses are below €10 million. Japan: Nomura financial giant says its losses could be up to $303 million. South Korea: South Korean financial groups have a total exposure of $95 million, officials say. Italy: UniCredit estimates its losses at around €75 million($101 million). Banco Popolare says its exposure is €68 million. Spain: Santander says it could lose up to €2.3 billion($3.1 billion), leading to a plunge in the bank's share price. BBVA says it could lose up to €300 million. Switzerland: Swiss financial groups could lose five billion dollars in the scam, the Le Temps newspaper reports. Reichmuth & Co, a private bank, says it may have lost 385 million Swiss francs ($328 million). EIM Group has an exposure of $230 million, media reports say. Benedict Hentsch bank announces loss of 56 million Swiss francs. UBS bank says its exposure was “limited and insignificant.” __
