Wells Fargo emerged as a surprise victim of the Bernard Madoff scandal on Wednesday, revealing a $294m loss caused by clients who defaulted on loans from the San Francisco-based bank after losing money in the alleged fraud. The Madoff-related charge was revealed as Wells reported a $2.5bn loss in the last three months of 2008 – its first quarterly loss since 2001. The charge at Wells, which prides itself on prudent lending policies, suggests that the effects of the alleged Madoff fraud may have touched a wider-than-expected range of financial institutions. People close to Wells stressed it had no direct exposure to Madoff’s brokerage firm, whose “Ponzi scheme” allegedly lost $50bn for clients.

This entry was posted by Gwen Robinson on Thursday, January 29th, 2009 at 5:47 and is filed under Capital markets, People. Tagged with Bernard Madoff, wells fargo. Edit this entry.