According to the lawyers, their clients believed for more than a decade that they had an account at the Westport National Bank, a division of Connecticut Community Bank in Westport, from which they had received statements for many years. Early last week, they learned their money had actually been entrusted to Mr. Madoff, the lawyers said.The lawyers' clients are said to have received statements from the bank showing charges for custodial and record-keeping fees of 4 percent a year.
A related press release from the lawyers is here.
Jan.3 update: From a Stamford Advocate article:
In 1999, at the request of an unidentified local company, Westport National Bank replaced another financial institution as the custodian for a number of individuals and entities that were investing with Bernard L. Madoff Securities, [Richard Cummings, president of Westport National Bank] said.
"Nearly all of these individuals and entities had been investing with Madoff long before the Bank was founded in 1998," Cummings said.
The custodial agreement "reflected the fact that each custodial client directed the Bank to give Madoff 'full discretionary authority' to invest the custodial client's funds," he said.
"Each custodial client specifically acknowledged in writing that the client had not relied on the Bank in choosing to invest with Madoff," he said.