A number of respectable institutions, from banks to firms that manage funds of hedge funds, will likely be damaged by yesterday's stunning revelations.
Groups known to have worked with Madoff in the past include alternative-asset manager Fairfield Greenwich Group, the Nomura Bank of Japan, and Swiss asset-management firm NPB New Private Bank.
Sources tell The Post that Madoff managed money for Fairfield Greenwich through a $7 billion hedge fund called Fairfield Sentry, which Nomura and NPB offered to clients.
According to a document obtained by The Post, the fund reported earnings of 4.5 percent at the end of October. Another document says the fund has a 15-year track record of producing 11 percent returns.
Fairfield Greenwich officials declined to comment.
Madoff's trading strategy, known as "split-strike conversion," has raised eyebrows in the past, sources said. The complex strategy involves trading in and out of large-cap stocks and buying put options on baskets of stocks.
"I think a lot of people already were very suspicious," said one hedge-fund executive. "If you look at the performance, it looks too good to be true. And if it looks too good to be true, chances are it is."
With Mark DeCambre