Deposition Hugh Burnaby Atkins PDF

In The Matter Of:
OPTIMALU.S.LITIGATION
___________________________________________________
HUGHBURNABYATKINSVol.1
July18,2012
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CONFIDENTIAL
CONFIDENTIAL
HUGH BURNABY-ATKINS - 7/18/2012
Page 1
IN THE UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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IN RE OPTIMAL U.S. LITIGATION
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CIVIL ACTION NO:

10-CV-4095 (SAS)
CONFIDENTIAL VIDEOTAPED DEPOSITION OF

MR. HUGH BURNABY-ATKINS
BEFORE THE EXAMINER MR. ALLEN DYER
VOLUME I
Wednesday, July 18, 2012
AT: 9:03 a.m.
Taken at:
Merrill Corporation
Level 2
101 Finsbury Pavement
London, EC2A 1ER
Court Reporter:
JUDITH WHITE
1-800-325-3376
Merrill Corporation - New York

www.merrillcorp.com/law
CONFIDENTIAL
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APPEARANCES
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Appearing on behalf of the Plaintiffs:

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JAVIER BLEICHMAR
LABATON SUCHAROW
140 Broadway
New York, NY 10005
Telephone: 212.907.0887
Email:
jbleichmar@labaton.com
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ALAN I. ELLMAN
LABATON SUCHAROW
140 Broadway
New York, NY 10005
Telephone: 212.907.0877
Email:
aellman@labaton.com
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MICHAEL L. GREENWALD
GREENWALD DAVIDSON PLLC
5550 Glades Road
Suite 500
Boca Raton, FL 33431
Telephone: 561.826.5477
Email:
mgreenwald@mgjdlaw.com
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MONICA P. FOLCH
SPEARS & IMES
51 Madison Avenue
New York, NY 10010
Telephone: 212.897.4482
Email: mfolch@spearsimes.com
DAVID SPEARS
SPEARS & IMES
51 Madison Avenue
New York, NY 10010
Telephone: 212.213.6991
Email: dspears@spearsimes.com
THE EXAMINER:
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RICHARD HOMEWOOD
RICHARD SLADE AND COMPANY
Ground Floor East
9 Gray's Inn Square
London WC1R 5JD
Telephone: +44.(0)20.3330.0900
Email:
richard.homewood@richardslade.com
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MR. ALLEN DYER

4 Pump Court
Temple, London EC4Y 7AN
Telephone: +44.(0)20.7842.5555
Email: adyer@4pumpcourt.com
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THE VIDEO OPERATOR:

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JAMES DRAKE QC
7KBW BARRISTERS
7 King's Bench Walk
Temple, London EC4Y 7DS
Telephone: +44.(0)20.7910.8300
Email: jdrake@7kbw.co.uk
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Appearing on behalf of the witness:
Appearing on behalf the Defendants:

SAMUEL A. DANON
HUNTON & WILLIAMS LLP
1111 Brickell Avenue
Suite 2500
Miami, FL 33131
Telephone: 305.810.2510
Email:
sdanon@hunton.com
GUSTAVO J. MEMBIELA
Suite 2500
Miami, FL 33131
Telephone: 305.536.2688
Email:
gmembiela@hunton.com
MAX BUTTINGER
CLIFFORD CHANCE
10 Upper Bank Street
City of London
Greater London E14 5JJ
Telephone: +44.(0)20.7006.1373
Email:
max.buttinger@cliffordchance.com
MR. PHILLIP HILL

Video Operator
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WITNESS INDEX
Witness
Page
Hugh Burnaby-Atkins (sworn). . . . . . . . . . . . 18
Examination by Mr. Bleichmar . . . . . . . . . . 19
Cross-examination by Mr. Danon. . . . . . . . . .244
Re-examination by Mr. Bleichmar. . . . . . . . . 281
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EXHIBIT NO.
Exhibit 1
DESCRIPTION
PAGE
Email from...........................48
Claire Thew to Hugh Burnaby-Atkins,
dated May 27, 2005, with attachment,

Bates stamped OPTIMAL-000090059-0062
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6
Exhibit 2
Handwritten notes....................53
headed "Madoff. Conversation w/
Rafael Mayer", Bates stamped

OPTIMAL-001263134
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Exhibit 3
Memorandum from......................55
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Norman Chait and David Kim to
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"Marketing Force", dated
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December 9, 1998, Bates stamped

OPTIMAL-001263150-3153
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Exhibit 4
Document headed......................58
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"Due Diligence Update", from "DK",
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dated December 7, 1999, Bates stamped

OPTIMAL-001263158-3163
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Exhibit 5
Document headed......................62
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"SNS Partners Inc.", dated
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September 19, 2001, Bates stamped

OPTIMAL-001263164-3169
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Exhibit 6
Optimal document.....................69
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headed "Optimal Strategic U.S.
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Equity", dated August 2003,
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Greenwich Group. July 13, 2004",

Exhibit 13
Email chain..........................98
with the email at the top of
the first page being from
Tasneem Jeevanjee to Cecilia
Alvarez-Santullano and others,
dated April 25, 2005, Bates stamped
OPTIMAL-000136495-6499
Exhibit 14
Optimal document....................106
headed "Optimal Strategic U.S.
Equity", dated August 2003,
Exhibit 15
Email chain.........................107
with the first full email, at the top
of the first page, being from
Jonathan Clark to Manuel Echeverria,
copied to Hugh Burnaby-Atkins, dated
July 29, 2005, Bates stamped
OPTIMAL-000353431-3436
Exhibit 16
Email from..........................110
Hugh Burnaby-Atkins to
Manuel Echeverria, dated September 6,
2005, with attachments, Bates stamped
OPTIMAL-000060976-0984
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headed "Madoff. Questions for
Aug. '03 meeting", Bates stamped
OPTIMAL-001263136
Exhibit 8
headed "Madoff. 8/4/03", Bates
stamped OPTIMAL-001263120
Exhibit 9
Email from...........................79
Manuel Echeverria and others, dated
November 18, 2003, Bates stamped
OPTIMAL-003770438
Exhibit 10
Email from...........................85
Manuel Echeverria and others, dated
June 16, 2004, Bates stamped
OPTIMAL-003099621
Exhibit 11
Document headed......................87
"Madoff Securities. JCL call with
Frank DiPascali. July 1, 2004",
Exhibit 12
Document headed......................93
"Madoff Securities. JCL call
with Amit Wijaywergiya, Fairfield
Exhibit 7
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Exhibit 17
Email chain.........................123
Claire Ikeda-Thew to "Redacted",
dated September 8, 2005, Bates stamped
OPTIMAL-000082078-2079
Exhibit 18
Email from..........................125
Jonathan Clark to Manuel Echeverria,
Rajiv Jaitly and Hugh Burnaby-Atkins,
dated November 21, 2005, Bates
stamped OPTIMAL-001912567-2568
Exhibit 19
Document headed.....................128
"Investment Process", Bates stamped
OPTIMAL-000022835-2866
Exhibit 20
Email chain.........................132
Edward Ondarza to Sebastien Poiret
and others, dated January 18, 2006,
Exhibit 21
headed "Madoff Securities.
S&P 100 Equity Options Arbitrage",
dated February 1, 2006, Bates stamped
OPTIMAL-000434167-4169
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Exhibit 22
Handwritten notes...................137
headed "Madoff Securities. 2-1-06.
Bernie Madoff", Bates stamped
OPTIMAL-001263090-3093
Exhibit 23
Email from..........................138
Rajiv Jaitly to Hugh Burnaby-Atkins
and others, dated October 13, 2006
with attachment, Bates stamped
OPTIMAL-000434817-4867
Exhibit 24
dated June 2006, Bates stamped
OPTIMAL-000434178-4184
Exhibit 25
dated July 2006, Bates stamped
OPTIMAL-000839534-9542
Exhibit 26
Email from..........................142
Jonathan Clark to Hugh Burnaby-Atkins,
dated July 19, 2006, Bates stamped
OPTIMAL-000492044
Exhibit 27
Email chain.........................156
with the email at the top of the
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first page being from

Hugh Burnaby-Atkins to Manuel
Echeverria, copied to others,
OPTIMAL-003130936-0939
Exhibit 28
Document headed.....................158
"Confidential - For Manuel Echeverria
Eyes Only", Bates stamped
OPTIMAL-000267520-7523
Exhibit 29
Email from..........................159
Manuel Echeverria, dated
September 19, 2006, Bates stamped
OPTIMAL-000868616-8618
Exhibit 30
Email from..........................162
Tasneem Jeevanjee to
Hugh Burnaby-Atkins, copied to
Manuel Echeverria, dated
October 18, 2006, Bates stamped
OPTIMAL-003146870
Exhibit 31
Email from..........................163
Christophe Encarnacao to
Hugh Burnaby-Atkins and others,
dated November 8, 2006, Bates
Exhibit 32
Excel spreadsheet...................163
entitled "Optimal Strategies
US Equity Fund", associated with,
but not marked, Bates stamp
OPTIMAL-000412803
Exhibit 33
Email chain.........................166
first page being from
Manuel Echeverria, dated March 6, 2007,
Exhibit 34
Email chain.........................171
first page being from Balkir Zihnali
to Oleg Langbort, dated March 28, 2007,
with attachments, Bates stamped
OPTIMAL-001279266-9359
Exhibit 35
Email chain.........................188
with the email at the top of the first
page being from Hugh Burnaby-Atkins
to Manuel Echeverria, copied to others,
dated April 17, 2007, with attachment,
Exhibit 36
Email from..........................200
Hugh Burnaby-Atkins to Jonathan Clark,
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copied to others, dated March 29, 2006,

with attachments, Bates stamped
OPTIMAL-000826891-6920
Exhibit 37
Email chain.........................219
first page being from Sebastien Poiret
to Jason Mercurio and others,
OPTIMAL-004168917-8919
Exhibit 38
Email chain.........................220
first page being from Oleg Langbort
to Hugh Burnaby-Atkins and
Jonathan Clark, dated July 10, 2007,
Exhibit 39
Email chain.........................225
to Jaime Calvo, copied to others,
dated August 10, 2007, Bates stamped
OPTIMAL-000179957-9961
Exhibit 40
Email chain.........................229
to Manuel Echeverria, dated
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OPTIMAL-003129912-9913
Exhibit 41
Email chain.........................230
page being from Jonathan Clark to
Hugh Burnaby-Atkins, dated
OPTIMAL-000414060-4061
Exhibit 42
Email chain.........................231
page being from Hugh Burnaby-Atkins to
Jonathan Clark, dated October 30, 2007,
Exhibit 43
Email chain.........................232
page being from Jonathan Clark to
Hugh Burnaby-Atkins, dated
OPTIMAL-004383194
Exhibit 44
Document entitled...................234
"Optimal Risk Management.
January 2008. Dedicated Solutions
in the Alternative Investment World",
Exhibit 45
Email chain.........................236
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page being from Oleg Langbort to
"Redacted", dated March 14, 2008, Bates
stamped OPTIMAL-001322424-2427
Exhibit 46
Document entitled...................237
"Optimal. Specialists in Alternative
Investment Management. Investment
Process Handbook. October 2007",
Exhibit 47
Email chain.........................250
first page being from Jonathan Clark
to Hugh Burnaby-Atkins, dated
April 15, 2008, Bates stamped
OPTIMAL-000253907-3913
Exhibit 48
Document headed.....................250
"Document Produced Natively", Bates
Exhibit 49
Document headed.....................250
"Document Produced Natively", Bates
Exhibit 50
Email chain.........................268
to Rajiv Jaitly, dated June 8, 2006,
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PROCEEDINGS
(9:03 a.m.)
THE VIDEO OPERATOR: This is the
video operator speaking, Gary Hughes, of
Merrill Legal Solutions, 25 West 45th Street,
New York, 10036. Today is the 18th of July 2012
and the time is 9.03 a.m., as indicated on the
video screen.
We are at the offices of Merrill
Corporation, 101 Finsbury Pavement, London,
United Kingdom, to take the videoed deposition of
Mr. Hugh Burnaby-Atkins in the matter of
Re Optimal U.S. litigation in the U.S. District
Court, Southern District of New York, case number
10-CV-4095 (SAS).
Would counsel please introduce
themselves?
MR. BLEICHMAR: Javier Bleichmar from
the law firm of Labaton Sucharow LLP on behalf of
the plaintiffs.
MR. ELLMAN: Alan Ellman from
Labaton Sucharow LLP on behalf of the plaintiffs.
MR. GREENWALD: Michael Greenwald from
the law firm of Greenwald Davidson on behalf of
the plaintiffs.
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MR. HOMEWOOD: Richard Homewood from the
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London law firm Richard Slade and Company for the
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plaintiffs.
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MR. DANON: Sam Danon from Hunton &

Williams on behalf of the defendants.
MR. MEMBIELA: Gustavo Membiela
from Hunton & Williams on behalf of the
defendants.
MS. FOLCH: Monica Folch from the law
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firm of Spears & Imes, counsel for the witness,
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Hugh Burnaby-Atkins.
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MR. SPEARS: David Spears, law firm of

Spears & Imes for Mr. Burnaby-Atkins.
MR. DRAKE: James Drake QC for
Mr. Burnaby-Atkins
MR. BUTTINGER: Max Buttinger from
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MR. HUGH BURNABY-ATKINS,
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having been duly sworn,
Clifford Chance on behalf of the defendants.

THE EXAMINER: Allen Dyer, the examiner.
testified as follows:
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THE EXAMINER: Your full name and your

professional address, please?
THE WITNESS: Hugh Graham
Burnaby-Atkins, Liability Solutions,
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17C Curzon Street, London.

THE EXAMINER: Thank you.
EXAMINATION BY MR. BLEICHMAR:
BY MR. BLEICHMAR:
Q. Good morning, Mr. Atkins.
A. Good morning.
Q. You're not currently employed by
Banco Santander or an affiliate; correct?
A. Correct.
Q. At what point in time were you
employed by Banco Santander or one of its
affiliates?
A. From April of 2003 to August of
2008.
Q. And which entity, specifically, were
you employed by?
A. By Santander Investment Securities
in New York.
Q. And is that a subsidiary of
Banco Santander SA?
A. It's a subsidiary of the wider group
of Banco Santander, yes.
Q. And -A. SA is a Swiss company; right?
Q. My understanding is that
Banco Santander SA is a Spanish company.

A. Okay.
Q. I was referring to the parent
holding company.
A. Okay. The bigger Santander group.
Q. Exactly. What was your position
when you started at -- can we refer to Santander
Investment Securities as "SIS"?
A. Yes, that's fine.
Q. What was your position in April of
2003 when you began at SIS?
A. I was a senior analyst.
Q. And who did you report to?
A. I reported to Steve Seneque.
Q. And what was Steve Seneque -- and
"Seneque" is S-E-N-E-Q-U-E; is that correct?
A. Correct, yes.
Q. And what was Steve Seneque's
position at the time?
A. He was director of research for the
Optimal group in Geneva.
Q. And was Mr. Seneque based in Geneva?
A. Yes, he was.
Q. Did you have a direct report in
New York?
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A. No.
Q. Was there a person who was the head
of the office, of the New York office, at the
time?
A. That was me. For -- for Optimal,
that is.
THE EXAMINER: Sorry, who was that?
THE WITNESS: That was me for the -- for
the small Optimal team, for the three of us at
Optimal. There were only three of us who -- who
effectively reported into Optimal, even though we
were employed by SIS.
BY MR. BLEICHMAR:
Q. Let me break that down a little bit.
Who are the three individuals who you are
referring to?
A. Myself, Jonathan Clark and
Elizabeth Searcy.
Q. I'm sorry, Elizabeth?
A. Searcy, S-E-A-R-C-Y.
Q. When you refer to "Optimal", are you
referring to Optimal Investment Services SA?
A. Yes. Yes.
Q. So it is -- is it correct that you
were employed by Santander Investment Securities
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but you had responsibilities with respect to

Optimal Investment Services?
A. Yes.
Q. And can we refer to
Optimal Investment Services as "OIS" going
forward?
A. Yes.
Q. Is that a common acronym that was
used to refer to Optimal?
A. We tended to refer to it as Optimal,
rather than OIS, but they were interchangeable.
Q. We can use "Optimal", if it's easier
for you.
A. Okay.
Q. What was Jonathan Clark's position
at the time?
A. He was an analyst.
Q. And did he report to you?
A. Yes, he did.
Q. And what was Elizabeth Searcy's
position?
A. She was also an analyst.
Q. And did she also report to you?
A. She reported to me in a managerial
sense on the day-to-day running of the office, but
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for her professional work, she reported to

Steve Seneque.
Q. And why was that?
A. Because she was operating in the
long/short equity strategy bucket, and I didn't
have responsibility for that.
Q. Can you tell me briefly what the
"long/short equity bucket" means in layman terms?
A. We -- we had our investments divided
into three broad categories: one was relative
value and arbitrage; one was trading strategies;
and one was equity strategies.
I was responsible for the arbitrage
strategies and assisted initially on the trading
strategies. I didn't cover the equity strategy
bucket.
Q. Was Steve -- was Mr. Seneque
responsible for overseeing all three strategies?
A. No, he was responsible for the
arbitrage strategies and the trading strategies.
Q. And -A. I mean, he had some
responsibilities. There were -- there were -there were divisions and -- and overlaps, but that
was primarily his responsibility.
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Q. What were Mr. Clark's

responsibilities?
A. He was dedicated to the arbitrage
strategy silo and also to monitoring the SUS
strategy.
Q. When you say "the SUS strategy",
are you referring to Optimal Strategic U.S. Equity
Limited?
A. Yes.
Q. And is that a fund that was -invested in -- in Madoff?
A. Yes.
Q. Was the SUS fund separate and apart,
in your view, from the relative value arbitrage
strategies?
A. SUS was, yes.
Q. And why was that?
A. Because it was a single strategy
fund, rather than a fund of funds.
Q. And can you explain what that means,
to me, please?
A. A fund of funds is a portfolio that
is invested across a number of different third
party hedge funds. A single strategy fund was
just one fund with a -- a wrapper around it which
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allowed clients to get exposure to just that one

fund.
Q. And by "the wrapper", are you
referring to effectively SUS?
A. To a fund vehicle, yes, so SUS.
Q. Did Optimal manage any other single
strategy funds, other than SUS?
A. Yes.
Q. And which funds are those?
A. Those -Q. Let me rephrase that. Which funds
were those at the time -A. There were none at the time
I joined. There were others later.
Q. So there were no single strategy
funds, other than SUS, as of approximately
April of 2003; correct?
A. Correct.
Q. Which other funds were single
strategy funds that appear later?
A. There was a single strategy fund
invested in the Renaissance equity strategy -I forget the exact name of it -- and there was one
invested in the Renaissance futures strategy.
Q. And approximately when were those
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funds started?
A. Approximately 2007, but I could be
out by a year.
Q. So before the Renaissance -- the
two Renaissance funds, the only single strategy
fund that Optimal managed was SUS; correct?
A. Yes.
Q. Prior to your departure -- or let me
rephrase that.
During your time at -- at Optimal and at
SIS, between April of 2003 and August of 2008,
what were all the single strategy funds that
Optimal managed?
A. So the -- the total number of -during my entire time there?
Q. Right.
A. I -- those three funds are the ones
I recall, and I'll leave it at that. I think
that's correct. There may have been others,
but there were -- anyway, there may have been
others.
Q. I just want to -A. But those are -- those are the key
ones.
Q. I just want to get your
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recollection. The documents are what they are.

I understand that.
A. Yeah.
Q. You mentioned -- and -- and I -I don't exactly recall -- that Jonathan Clark had
responsibility for SUS; correct?
A. He had responsibility for monitoring
SUS.
Q. For monitoring SUS. What other
responsibilities did he have?
A. And he had responsibilities for
conducting due diligence and performing research
and analysis on the portfolio -- the funds that
would go into the arbitrage portfolio.
Q. Did Mr. Clark precede you in his
employment with SIS?
A. We arrived at the same time;
within a few weeks.
Q. Approximately April of 2003?
A. Approximately.
Q. Did you know Mr. Clark prior to your
employment at SIS?
A. No.
Q. Who does Mr. Seneque -- Seneque
report to?
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A. To Manuel Echeverria.
Q. And, again, this is approximately
when you started in April 2003; correct?
A. Yes.
Q. And did that change at any point in
time during your employment at SIS?
A. Yes, Mr. Seneque left in, I think,
2005.
Q. And who replaced Mr. Seneque in
2005?
A. No-one.
Q. Did your responsibilities expand as
a result of Mr. Seneque's departure?
A. Yes, they did, yep.
Q. How did they expand?
A. He obviously did a lot of work.
There was no-one to do that work, and, therefore,
I had responsibility for a lot of the work that he
had been doing -- not all of it, but a good
proportion of it. So, basically, I was promoted
upwards.
Q. You mentioned that Jonathan Clark
had responsibility for monitoring SUS; correct?
A. Yes.
Q. Did you have any responsibilities in
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connection with SUS?

A. I was responsible for supervising
his work.
Q. And who did you report to between
April of 2003 and the time that Mr. Seneque left
in 2005?
A. Mr. Seneque.
Q. And after Mr. Seneque left, who did
you report to?
A. To Mr. Echeverria.
Q. And Mr. Echeverria is
Manuel Echeverria; correct?
A. Manuel, yes.
Q. And he was the CEO of Optimal; is
that right?
A. Yes.
Q. He was the CEO of Optimal from
April 2003, when you started, through when?
A. Through 2008, so my entire time
there, he was the CEO.
Q. Through August, more or less,
of 2008?
A. Yes.
Q. July/August, give or take?
A. Yes.
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Q. You mentioned that Jonathan Clark

monitored SUS and that he conducted due diligence
and analysis that would go into the arbitrage
portfolio?
A. Yes.
Q. Is that right?
A. Yes.
Q. What is the difference between
monitoring SUS and conducting due diligence and
analysis?
A. Jonathan's primary responsibility
was to confirm that the trading that occurred
within SUS conformed to a -- a set of rules,
so that was his formal responsibility, and due
diligence analysis, research and evaluation is a
process that takes place before an investment is
made, all the way through that investment being
made, and then subsequently, so there are
different levels of -- of workload required
between the two.
Q. Did Jonathan Clark, at any point in
time, have any responsibilities beyond monitoring
SUS?
MR. DRAKE: Well, sorry to interrupt
you, but Mr. Burnaby-Atkins has already told you
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that his responsibilities in relation to SUS went

to monitoring and that his other responsibilities
were to conduct due diligence and research
analysis on funds for the arbitrage portfolio, so
to the extent that you're asking that question
again, that's the answer you've already been
given.
MR. BLEICHMAR: I'm just trying to make
sure that the record is clear. I don't think I'm
going beyond the bounds, if you don't mind.
THE EXAMINER: You can ask that
question.
BY MR. BLEICHMAR:
Q. Let me ask it again, just so that we
have a clean record: did Jonathan Clark, at any
point in time, have any responsibilities beyond
monitoring SUS?
A. Formally, no.
Q. Why do you say "formally"?
A. Because I think, as professionals,
we took a level of care that was greater than what
was the bare minimum required of us and went to a
great deal of extra work.
Q. And what kind or what type of great
deal of extra work did -- let me rephrase that.
You say, "We took a greater level of care

and went to a great deal of extra work". That
includes you and Jonathan Clark?
A. Yes.
Q. And what extra -- let me strike
that, because you did not say "extra".
What great deal of extra work did you and
Jonathan Clark conduct with respect to SUS?
A. I think we understood that the
formal responsibility was for monitoring and
confirming compliance with the trading directive,
but, in practice, we treated it as if it was any
other investment and conducted full due diligence
as if it was any other vehicle that was under
our -- under our -- within our remit, and that
meant full.
So we did everything we felt we were able
to do, in terms of monitoring and evaluating and
conducting research into that strategy.
Q. When you refer to "full due
diligence", if you could explain what that means,
or, alternatively, what that is composed of?
A. I'm just going to make one point, if
I may -Q. Sure.
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A. -- in that due diligence is

typically conducted prior to an investment being
made, and that the Optimal SUS fund had been
running satisfactorily, to all intents and
purposes, six years before my arrival.
So there was -- it's not unreasonable to
assume that full due diligence, pre-investment due
diligence, had been conducted by my predecessors,
so -Q. Fair point.
A. So -Q. Let me just try to narrow the
question so that we begin with what is your -MR. DANON: Objection. If he has more
to say, I'd like him to finish his answer.
MR. BLEICHMAR: Oh, absolutely.
THE WITNESS: So that -- that was the
point I would make about what level of due
diligence was -- was -- was required of us.
In practice, we set about treating that
investment as if it was a new investment, because
it was new to us, and began at the beginning
and -- and went from there.
BY MR. BLEICHMAR:
Q. With that in mind, what do you
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consider full due diligence?

A. That's a huge question.
MR. DRAKE: You -- you'll have to help
him out a bit.
THE EXAMINER: Is it really material,
Mr. Bleichmar, because we're dealing with an
existing investment. Going through the whole
panoply of full due diligence on a proposed
investment doesn't seem to me -MR. BLEICHMAR: It is absolutely
essential, because the key topic in examination is
the due diligence of Optimal SUS.
THE EXAMINER: Yes, but he's explained
that that was a -- somewhat different to the
process that would be employed when a proposed new
investment was coming on.
MR. BLEICHMAR: That -- I'm trying to
parse out what the components of full due
diligence is. It is a term that the witness used.
THE EXAMINER: No, why don't you do it
in relation to SUS, as opposed to globally?
MR. DRAKE: And that way, in particular,
it would be caught by number 1 of schedule A.
THE EXAMINER: Yes. I mean, I'm sure we
could discuss due diligence as a concept for days,
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but it's due diligence in relation to SUS that you

are concerned with here.
BY MR. BLEICHMAR:
Q. Do you know whether full
due diligence was conducted at the time of the
original investment in SUS?
A. No, I don't know. I saw some
reports that were written, but I don't know
exactly what level of due diligence was conducted,
because I wasn't there.
Q. What reports did you see?
A. I saw a handful of reports that were
written by my predecessors.
Q. And who are your predecessors?
A. By Norman Chait and David Kim
specifically, but others I'm sure were involved in
it too.
Q. And who are David Kim and
Norman Chait, to the extent that you know?
A. David Kim was an analyst at SIS who
preceded me, and Norman Chait was the same,
I think slightly more senior than David.
Q. Did you overlap with Mr. Kim or
Mr. Chait?
A. Not at SIS, no.
Q. So you don't know them?

A. Not particularly. I'd met -I'd met David Kim, but I hadn't met Norman Chait
when I went to work at -- at SIS.
Q. So your -- is it fair to say that
your only understanding of the due diligence that
they conducted on SUS is based on the reports that
you read?
A. Well, bear in mind, also, that
Mr. Seneque was -- provided continuity over that
investment. Not only did he provide continuity,
but Mr. Echeverria provided even greater
continuity, because Mr. Echeverria had set it up,
so he was the ultimate repository of -- of the
due diligence that had been conducted on that
fund.
Q. So you -- did you have discussions
with Mr. Seneque and Mr. Echeverria over the
due diligence that had been conducted on SUS?
A. Yes. I don't recall them
specifically, but I'm sure that, as with any other
investment, we would have discussed it.
Q. When you say that "he was the
ultimate repository of the due diligence that had
been conducted on the fund", you are referring to
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Mr. Echeverria; correct?

A. Yes.
Q. And why is it that he was the
ultimate repository of the due diligence?
A. He was the chief investment officer,
and he was specifically responsible for all of the
funds, but he was even more specifically
responsible for that fund.
Q. Is it your understanding that
Mr. Echeverria conducted or was part of the team
that conducted the initial due diligence on SUS?
A. Yes.
Q. And how do you have that
understanding?
A. I saw in some of the reports that he
was present at those meetings, and he also made it
clear, in conversation with him, that he was the
primary person responsible for handling that
account.
Q. You've mentioned so far
Mr. Echeverria, Mr. Chait and Mr. Kim as having
responsibility for SUS; correct?
A. Yes.
Q. Any other individuals, prior to your
arrival at -- at Optimal, that you're aware that
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had responsibilities for SUS?

A. I don't think so.
Q. Do you know where Mr. Chait or
Mr. Kim are -- are today?
MR. DRAKE: I object to that question.
THE EXAMINER: This is not disclosure.
MR. BLEICHMAR: That's fine.
MR. DRAKE: Whilst I've interrupted you
there, is there any chance that we could fiddle
with the thermostat?
THE EXAMINER: Can we go off -MR. BLEICHMAR: Let's go off the record
for a moment.
MR. DRAKE: It seems to be 1000 degrees
in here.
THE VIDEO OPERATOR: Going off record at
9.25 a.m.
(9:25 a.m.)
(Break taken.)
(9:26 a.m.).
THE VIDEO OPERATOR: Going back on
record at 9.26 a.m..
BY MR. BLEICHMAR:
Q. In connection with SUS, could you
describe for me what you understand full
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due diligence to mean?

MR. DRAKE: No, I'm going to object to
that question as well. You can ask him what
due diligence was conducted, but you can't ask him
for a thesis on what comprises due diligence
because he's not here as a -- some sort of expert
witness; he's here to tell you what took place in
the period set forth in the schedule.
MR. BLEICHMAR: That is what I asked
him.
THE EXAMINER: Well, you didn't, because
this due diligence that we're referring to was
conducted by other people before he even joined.
I think Mr. Drake's objection is well founded.
MR. BLEICHMAR: Let -- let me rephrase
that.
BY MR. BLEICHMAR:
Q. What is your understanding of the
full due diligence that was conducted on SUS?
MR. DRAKE: But that's the same
question.
MR. BLEICHMAR: That's the question -"What due diligence was conducted?"; that's what
you suggested that I ask.
MR. DRAKE: Sorry, did you say "full"
again?
MR. BLEICHMAR: Yes, because that's -that's the phrase he used.
THE EXAMINER: He's entitled to ask what
understanding this witness has of what was done at
the time. You're perfectly entitled to ask that.
MR. BLEICHMAR: That's" what I asked.
MR. DRAKE: Well ask -- ask that.
THE EXAMINER: I think it's this word -you use the word "full".
MR. BLEICHMAR: Well, the witness used
the word "full", so I'm trying to understand what
he meant by that in the context of SUS.
THE EXAMINER: Fine.
MR. BLEICHMAR: Which I understand is
the point number 1 of the topics.
THE EXAMINER: Yes. You -- you are
entitled to ask his understanding of -MR. BLEICHMAR: So let me rephrase the
question again, based on Mr. Drake's generous
suggestion.
BY MR. BLEICHMAR:
Q. What full due diligence is it your
understanding was conducted of Optimal SUS prior
to your arrival?
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A. I understood that they had been

rigorous in analyzing the structure and the
competence and the strategy that Madoff Securities
proposed to use to manage the assets of the
clients invested in that -- in that vehicle and
that my predecessors would have taken great care,
been rigorous, detailed and conscientious and
competent to make those assessments.
Q. And what gave you that
understanding?
A. They were highly qualified
professionals who were experienced in the industry
and had been practitioners in that and specialists
in that field for a good period of time.
Q. Other than the fact they were highly
qualified professionals and experienced, did
anything else give you that understanding?
A. Reputationally in the industry.
I knew them to be highly experienced.
Q. Anything else?
A. And -- and I saw the research notes
that were -- that were produced.
THE EXAMINER: Can I just be clear on
one thing. You referred to "in that field". What
field were you referring to?
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THE WITNESS: In -- in the field of

conducting due diligence on -- on hedge funds.
BY MR. BLEICHMAR:
Q. You said you saw the research notes
that were produced. What gave you the impression
in those research notes that -- that full
due diligence had been conducted on SUS?
A. I mean, I'm going to limit what
I can say, because I wasn't there and -MR. DRAKE: Which is why, and
I interrupt, which is why the question is
objectionable, because, according to the
parameters set forth in schedule A, which govern
this examination, you're entitled to ask this
witness in respect of the period from when he
started, which is April 2003, through to
January 2009, in respect of the due diligence that
was conducted on the Madoff fund.
MR. BLEICHMAR: And this is knowledge
that he gained within that period, so I'm
asking -- I'm not asking about his knowledge prior
to the period. I'm asking, within that period,
what understanding did you have of the
due diligence that the entity that he worked for
and that he said he adopted and then reviewed was
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conducted prior to him.

So I think it is a perfectly valuable -valid question, and in -- with all due respect,
Mr. Drake, at some point you are interfering with
my examination and -THE EXAMINER: Not at the moment.
Why don't you take him to some documents? It
really is very difficult to start asking witnesses
about what they started to pick up in April 2003
when we are in July 2012. We have got the
documents here.
MR. BLEICHMAR: Well, I -- I'm trying to
get his recollection first, outside of the
documents.
THE EXAMINER: I just think this is an
unfair process. It is not a memory test of what
he picked up nine years ago.
MR. BLEICHMAR: It is not a memory test.
If he doesn't remember, he doesn't remember. It
is a perfectly fair answer.
THE EXAMINER: There comes a time when
you really must take him to the documents.
MR. BLEICHMAR: Can I get an answer to
the question, or not?
THE EXAMINER: You can get an answer to
this question.
MR. BLEICHMAR: Thank you.
THE EXAMINER: But I really don't want
him having to dredge through his memory to
remember what he picked up in April 2003, as
opposed to looking at documents.
MR. BLEICHMAR: I -- I will proceed to
documents very shortly.
Could you read the question again,
please.
(Record read.)
MR. DANON: I'm going to object to the
form of the question.
THE WITNESS: I can tell you that it was
my understanding that due diligence -- full
due diligence had been conducted, because it was a
professional, well-run organization, and then
there's a separate question of, what is full
due diligence, but I understood it had been done
and done to a high degree of care.
BY MR. BLEICHMAR:
Q. Did you know the specific details of
the due diligence that had been conducted?
A. No.
Q. We've gone over the individuals that
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were involved with Optimal SUS prior to your

arrival at Optimal; correct?
A. Yep.
Q. And you've mentioned that you and
Mr. Clark had responsibility for Optimal SUS while
you were there; correct?
A. Yes.
Q. Did any other individuals at Optimal
have responsibility for SUS during your tenure?
A. Yes.
Q. At Optimal. Who were they?
A. Oleg Langbort subsequently took over
that responsibility for Mr. Clark.
THE EXAMINER: That's the monitoring
responsibility?
THE WITNESS: Yes.
BY MR. BLEICHMAR:
Q. And when you say "subsequently to
Mr. Clark", when was that?
A. I'm not sure of the exact date, but
it was towards the end of my time there.
Q. So it's some time in the middle of
2008; is that fair to say?
A. I'm not sure. It might have been
then or it might have been the year before.
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Q. Other than Oleg Langbort, did

anybody else have any responsibilities with
respect to SUS at Optimal?
A. Yes. Mr. Jaitly and his team had
responsibility for conducting non-investment
due diligence on Madoff -- or revisiting that
due diligence, I should say.
Q. And what did -- what is your
understanding of what Mr. Jaitly's team's
non-investment due diligence included, with
respect to SUS, of course?
A. Again, a big subject. He was
responsible for confirming that the structure of
SUS was suitable; that the documentation was
suitable; and that everything that Mr. Madoff said
he was doing was he -- he was in fact doing.
Q. When you say "he was responsible",
you're referring to Mr. Jaitly was responsible;
correct?
A. Mr. Jaitly, yes.
Q. Would the responsibilities that
Mr. Jaitly had overlap with your responsibilities,
or did you have separate responsibilities? Again,
this is with respect to SUS and the due diligence
that was conducted on SUS.
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A. The two teams were designed to

support each other, and if one could help the
other one out, then that was always the desired
outcome.
Otherwise, there was a fairly clear
division between what was deemed to be investment
risk and non-investment risk.
Q. And with respect to SUS, again,
how would you -- or what was that clear division
between investment risk and non-investment risk?
A. So investment risk meant purely
monitoring the activities, as reported by
Mr. Madoff, to confirm that they conformed to the
trading directive.
Q. And non-investment risk?
A. Everything else.
Q. And if I understand you correctly,
your primary responsibility was investment risk;
is that correct?
A. Yes.
Q. And Mr. Jaitly's primary
responsibility was non-investment risk, which you
characterize as everything else other than
investment risk?
A. Yes.
Q. I think there was a "yes" to that?

A. Yes, there was.
Q. Mr. Atkins, I'm going to mark as
exhibit 1 a document bearing Bates stamps 90059
through 90062.
(Exhibit 1 marked for identification.)
MR. DRAKE: What's the date?
MR. BLEICHMAR: May -- let me put it on
the record.
BY MR. BLEICHMAR:
Q. The document in front of you,
Mr. Atkins, appears to be an email from C Thew on
May 27, 2005 to you; is that correct?
A. Yes.
THE EXAMINER: Are we starting at 1
again today, in terms of exhibits?
MR. BLEICHMAR: Yes.
BY MR. BLEICHMAR:
Q. I'm then going to ask you a series
of questions that may become very repetitive to
you by the end of the day that are merely designed
to essentially establish that you received the
document.
THE EXAMINER: Is it in these bundles?
MR. DRAKE: It's -- I think it's 43.
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THE EXAMINER: Is it 43?

MR. DRAKE: Yes.
BY MR. BLEICHMAR:
Q. Who was -- are you familiar with
somebody named Claire Ikeda-Thew?
A. Yes.
Q. And who was she?
A. She was an analyst who came to work
with us for the summer, while doing her MBA at the
Wharton School.
Q. And when you say "the summer", are
you referring to the summer of 2005?
A. Yes.
Q. And the document in front of you,
is this a document that you understand to be an
email from Ms. Thew to you?
A. I think it was an attachment to an
email, but yes.
Q. These documents were produced to us
by the defendants. Tell me if I'm mistaken, but,
as I understand it, the first page reflects the
actual email?
A. Yes.
Q. And the second and third and fourth
page reflect the attachment; is that correct?
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A. I think so, yes. That's what it

looks like.
Q. And did you receive -- and these are
the type of questions that are going to become
very repetitive.
Did you receive this type of -- this
email as part of your work and responsibilities
while at SIS?
A. Yes, I think so.
Q. And do you have any reason to
believe that this document was not authentic?
A. No.
Q. Do you have an understanding as to
why Ms. Thew sent you this email?
A. Yes.
Q. And what is that understanding?
A. I had asked her to do some work on
the SUS account.
Q. And what work had you asked her to
do on SUS?
A. To give it a full review, approach
it with a fresh pair of eyes. She was an
experienced professional. She'd worked at a hedge
fund, a very prominent hedge fund, BlackRock.
She came from the back office, the risk office,
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of a hedge fund, so she brought a new set of

skills to our firm, an additional set of skills to
our firm, and I thought she would be highly
qualified to help us go over, as I said, some of
the other areas that we understood and believed to
have been done already, but we felt, or I felt,
could benefit from a review.
Q. Is it fair to say that you were
generally impressed by Ms. Thew's skills?
A. Yeah, I think so. She was a very
competent person who's gone on to great success
since.
Q. And -- so your understanding is that
she sent you this email as part of your request
that she conduct a full review of SUS; correct?
A. Yes.
Q. And can you tell me what the
attachment to this email is?
A. It looks like a draft for a more
formal report that I expected she was going to
produce at the end of her -- of her work.
Q. And did you ask her to provide you
this draft?
A. I don't recall whether
I specifically asked her to do it or whether she
volunteered it.
Q. Did you provide comments to this
draft?
A. I believe I did.
MR. BLEICHMAR: And I will tell you that
we do not -- we have not seen a copy of your
comments, so that's why I'm going to ask for his
recollection, Mr. Dyer. To the extent that -THE EXAMINER: No, if there is no
document, you're perfectly entitled to ask for his
recollection.
MR. BLEICHMAR: I'm just pre-empting
squabbles, if you will.
BY MR. BLEICHMAR:
Q. Do you have any recollection as to
what your comments on this draft were?
A. I'd have to read it again, but -Q. Feel free to do so.
A. In the outline at this stage, the
short answer is no, other than that I would have
talked to her about some of the ideas and themes,
and one could probably deduce from the outline to
what the finished product looked like what those
comments would have been, but short of doing
that ...
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Q. Do you see this email is dated

May 27, 2005?
A. Yes.
Q. Do you have any understanding as to
how long, more or less, Ms. Thew had been with
Optimal at that point?
A. No. I can't remember.
Q. Is -- was this one of her first
assignments at Optimal, as far as you can
remember?
A. Yes.
Q. Do you have any other recollection
about this document?
MR. DRAKE: You can't ask that question.
That's a terrible question.
MR. BLEICHMAR: It's not. I'm trying to
find out if there's anything else he remembers.
THE WITNESS: Nothing salient.
BY MR. BLEICHMAR:
Q. Thank you very much. That's all
I needed.
BY MR. BLEICHMAR:
Q. Mr. Atkins, I'm going to put in
front of you what I've marked as exhibit number 2.
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It's Bates marked 1263134.

Do you see that this document includes
some handwritten notes?
A. Mmm-hmm.
Q. Are these your notes?
A. No.
Q. Do you know whose notes they are?
A. I'm not sure. I could hazard a
guess, but it would be a guess, rather than
knowing.
Q. Without guessing. You -- you don't
know who they are?
A. I don't know for sure whose they
are.
Q. Do you have a reasonable basis to -or a reasonable understanding as to whose they may
be?
A. Yes.
Q. And what is your reasonable basis?
A. I think they are Jonathan Clark's
notes because they look like -- they resonate
with -- with some work that he did.
Q. Do you see that on the top
right-hand corner it says "Conversation with
Rafael Mayer"?
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A. Mmm-hmm.
Q. Were you present during what appears
to be this conversation with Rafael Mayer?
A. I'm not sure.
THE EXAMINER: Do you know who
Rafael Mayer was?
THE WITNESS: Yes. Yes, I do. Yes.
MR. BLEICHMAR: Let's move on.
THE EXAMINER: If you don't need to
know, that's fine.
MR. BLEICHMAR: I'm going to mark as
through 153.
BY MR. BLEICHMAR:
Q. Your counsel has graciously informed
me that your full name is Mr. Barnaby-Atkins.
I apologize for calling you Mr. Atkins beforehand.
A. That's okay.
MR. DRAKE: It's Burnaby-Atkins.
MR. BLEICHMAR: Mr. Burnaby-Atkins.
MR. DRAKE: We'll get there.
MR. BLEICHMAR: We'll get there.
THE WITNESS: "Burnaby" is fine for
short.
THE EXAMINER: Well, your name has

appeared in various guises in various documents in
the last few days.
MR. DRAKE: This happens to be at tab 1
of the bundle, Mr. Dyer.
THE EXAMINER: Yes, I have seen it,
thank you.
BY MR. BLEICHMAR:
Q. Do you recognize this document,
Mr. Burnaby-Atkins?
A. Yes. Yes, I do.
Q. And what is this document?
A. It is a -- a memorandum recording
a meeting with -- well, not recording a meeting,
but giving some overview of the SUS strategy.
Q. Is this one of the memorandums that
you were referring to earlier as the set of
reports that you reviewed -A. Yes.
Q. -- on your arrival at -- at Optimal?
A. Yes.
Q. And did you review this document as
part of your responsibilities at Optimal?
A. Yes.
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believe that this document is not an authentic

copy?
A. No.
Q. Do you see in the "Re" line there is
a notation to "BPI Multiadvisors"?
A. Yes.
Q. What -- do you have an understanding
as to what "BPI" is?
A. Yes, BPI was the predecessor to
Optimal, to OIS.
Q. And BPI, is that an acronym that
stands for -- for something?
A. I think it stands for Banco Privada
Internacional, so international private bank.
Q. In Spanish?
A. Yes.
Q. And is it your understanding that
BPI later became Optimal; is that what -- what
you -A. A part of BPI became Optimal.
Q. And what part of BPI became Optimal?
A. The part that was dedicated to fund
of funds and hedge fund investments.
THE EXAMINER: So was BPI part of
Santander overall?
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THE WITNESS: So BPI was -- there -there were -- BPI was part of -- there was asset
management, there was the private bank, and I'm
not sure how those fitted together.
THE EXAMINER: But it was part of -- it
was within the overall group?
THE WITNESS: But within the private
bank -- Manuel Echeverria had been a private -one of a number of private bankers, and he was the
one who created Optimal. So there's a much bigger
subset and I'm not quite sure that -- what the
extent of it was.
MR. BLEICHMAR: Let me mark as exhibit 4
a document bearing Bates numbers 1263158 through
163. It is dated December 7, 1999.
MR. DRAKE: Which is at tab 2.
BY MR. BLEICHMAR:
Q. Do you recognize this report?
A. Yes.
Q. And what do you recognize this to
be?
A. Again, it's another of the reports
that predated me, but which we reviewed as part of
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our information-gathering process.

Q. And you reviewed this document as
part of your responsibilities at Optimal during
your employment; correct?
A. Yes.
Q. And is -- do you have any reason to
believe that this is not an authentic copy?
A. No.
Q. Do you see in the "Re" line it says:
"Meeting with Bernard Madoff ...
"Attendees ..."
And there's a set of initials or
acronyms?
A. Yes.
Q. Do you know who those individuals
are?
A. Yes, I think I do.
Q. Can you please tell me?
A. Manuel Echeverria, the first;
"CM" is Cristina Macdonald; "DK" is David Kim;
and I believe "RB" is Rae Dubose, although it
being "RB" I'm not 100 percent confident of that.
Q. And who was Cristina Macdonald?
A. She was a senior private banker who
was based in New York.
Q. Is it your understanding that she

had any responsibilities for Optimal -- strike
that.
Is it your understanding that she had any
responsibilities for SUS?
A. No.
Q. She was -- do you -- is it fair to
say she was a private banker?
A. Yes.
Q. And not a due diligence hedge fund
person?
A. Yes.
Q. And who was Ray Dubois?
A. "Dubois" or "Dubose"?
Q. Oh, I -A. Dubose, I think.
Q. Dubose.
A. She was an analyst who worked with
the -- with David Kim and Norman Chait, I believe.
Q. And she was an analyst -- is it your
understanding that she was employed by SIS?
A. Yes, I think so. I'm not sure
exactly what her terms was.
Q. But she wasn't, as far as you know,
a private banker?
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A. Don't know.
Q. Fair enough. Do you -- did you
discuss this meeting reflected in this report with
Mr. Echeverria, with Mr. Kim or with anybody else?
A. With Mr. Clark, I would have
discussed it, and possibly with Mr. Echeverria,
but with Mr. Clark.
Q. And why did you discuss it with
Mr. Clark?
A. We -- I believed that it was
appropriate to review all the work that was on
record that we could find and -- and, like I said
earlier on, approach this investment as if it was
a new investment.
Q. Let me refer you to page number 2,
which is Bates stamped 3159. Do you see the
section number IV A, "Organizational Update" and
"Managed Accounts"?
A. Mmm-hmm.
Q. The last sentence of -- of the first
paragraph?
A. Yes.
Q. Which says:
"Mr. Madoff cites BPI Multiadvisors as an
example 'low maintenance' client given the manner
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in which we have handled the relationship over the

years."
A. Yes.
Q. What was your understanding at the
time of that sentence?
MR. DANON: Objection to the form of the
question.
THE EXAMINER: Do you mean April 2003?
MR. BLEICHMAR: Correct.
THE WITNESS: I don't recall exactly
what my reaction to that was, but this was useful
information, but it was -- it was something I was
going to approach from -- with a fresh pair of
eyes.
BY MR. BLEICHMAR:
Q. Mr. Burnaby-Atkins, I'm going to
show you what I've marked as exhibit number 5.
It's a document bearing Bates stamps 1263164
through 169, and it's dated September 19, 2001.
MR. DRAKE: Sorry, what number is it?
MR. BLEICHMAR: Exhibit 5.
THE EXAMINER: My tabs have gone out of
sequence. I'm behind tab 4 with this document.
It doesn't matter.
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MR. DRAKE: Oh, sorry, mine is behind

tab 3. Is it different to yours?
THE EXAMINER: I have had an extra tab
slipped in somewhere.
MR. DRAKE: Apologies.
THE EXAMINER: That's all right.
MR. DRAKE: It's going to make life a
bit difficult.
THE EXAMINER: That's all right. I can
follow.
MR. BLEICHMAR: And -- and just so the
record is clear, the references to the tabs are
not to the formal exhibits.
THE EXAMINER: No, no.
MR. BLEICHMAR: They are to documents -THE EXAMINER: No, no, the formal
exhibits will be attached to the transcript.
MR. BLEICHMAR: Thank you.
BY MR. BLEICHMAR:
Q. Do you recognize this document?
A. Yes.
be?
A. Again, it's another of the reports
that I referred to earlier on, which predated me,
which we -- which I believe I reviewed as part of

the information-gathering exercise we conducted.
Q. And those are the reports concerning
SUS; correct?
A. Yes.
Q. And did you review this document as
part of your responsibilities at work while at
SIS.
A. I believe I did.
believe that this is not an authentic copy of that
document?
A. No.
Q. Do you see that in the "Re" line, it
says:
"Meeting with [Bernie] Madoff September 11, 2001 ...
"Attended by BN, MEF, DK."
A. Yes.
Q. Who do you understand those
individuals to be?
A. Beat Notz, Manuel Echeverria and
David Kim.
Q. And Beat Notz is B-E-A-T, separately
N-O-T-C; is that correct?
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A. N-O-T-Z.
Q. N-O-T-Z, correct.
A. Yes.
Q. And who was, to the extent you know,
Beat Notz?
A. He -- well, he's no longer alive,
but he was one of the founding partners of
Notz Stucki, and if you see from the heading of
this, it's SNS Partners, so this was Santander
Notz Stucki, which was a separate entity.
Q. And what is your understanding of
the relationship of SNS Partners to SIS?
A. I don't know exactly, but it was a
joint venture between one of the Santander
entities and Notz Stucki.
Q. So although this document states
"SNS Partners Inc.", this is a document that you
reviewed in connection with your duties at SIS
with respect to SUS; correct?
A. Yes.
Q. At the -- let me rephrase that.
A. Just -- you said with respect to my
duties. I think, as we said, you know, my duty
was to monitor, so this was above and beyond what
was formally my duty.
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Q. Let me rephrase that. As part of

your responsibilities and general work at SIS?
A. Yes.
Q. Did the joint venture that you just
described, called SNS Partners Inc., have any
formal connection to the SUS fund?
A. Not as far as I'm aware -- well, by
virtue of it being partially owned by an entity
which had a formal connection, there is a "yes",
but it predated me and it was dissolved before
I got there.
Q. So the SNS Partners Inc. was
dissolved prior to your arrival at -- at SIS?
A. Yes.
Q. And how do you know that?
A. There was -- it just wasn't in
existence.
We -- I mean, this came from
SNS Partners, and we gathered what we could from
their archives, but it was no longer in existence,
and Mr. Kim had left and -- there was no-one in
New York, so it was gone.
I mean, legally, I don't know whether it
was -- it was technically kind of put to bed, but
it was -- there was nothing left of it.
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Q. Did Mr. Chait and Mr. Kim work for

SNS or for SIS?
A. I don't know about Mr. Chait, but
Mr. Kim worked for both.
Q. Did you, at any point in time,
become employed by a firm called Notz Stucki?
A. Subsequently to -- well, no, not -I became employed by TH Advisors with
responsibility to Notz Stucki.
MR. DRAKE: How is that a subject matter
on which you are entitled to ask a question?
MR. BLEICHMAR: I'm trying to assess
whether there's any connection of these entities
with the SUS due diligence in topic number 1.
MR. DRAKE: That's -- that's a different
exercise.
MR. BLEICHMAR: Not -- not to the extent
that SNS is part of Optimal and conducted
due diligence.
I'm just -- I -- this is a document in
the files of the defendants that says
SNS Partners. I am -- it's part of the
due diligence conducted on Optimal SUS, as far as
I know.
MR. DRAKE: But his employment at
Notz Stucki has got nothing to do with any of the

stated subject matters.
MR. BLEICHMAR: Well, I'm trying to -that may be the case, but -MR. DRAKE: Nor is it within the -THE EXAMINER: I don't think it's worth
spending too much time on it. I imagine you're
going to move on from there.
MR. BLEICHMAR: Absolutely.
MR. DRAKE: Well, I hope so.
MR. BLEICHMAR: Absolutely.
Can you read back my question, please?
(Record read.)
BY MR. BLEICHMAR:
Q. Did TH Advisors have any connection
to SNS Partners?
A. No.
Q. Did you discuss this report,
exhibit number 5, with Mr. Echeverria?
A. I'm not sure. I'm not sure
specifically.
Q. You don't have any recollection one
way or the other?
A. No.
MR. BLEICHMAR: I'm going to mark
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exhibit 6 as a document bearing Bates stamps

1263099 through 110. It is dated August 2003.
MR. DRAKE: It's my tab 6, Mr. Dyer.
THE EXAMINER: Yes.
BY MR. BLEICHMAR:
Q. Do you recognize this document,
Mr. Burnaby-Atkins?
A. Yes.
A. It's a research note that my team
put together with relation to Optimal SUS.
Q. Did you participate in putting this
research note together?
A. Yes. Yes.
Q. And did you put this research note
together as part of your responsibilities and work
at SIS?
A. Yes.
believe that this research note is not an
authentic copy?
A. No.
Q. Who was the primary author of this
research note?
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A. I'm -- I'm not sure.

Q. Why aren't you sure?
A. Because Mr. Clark and I both worked
on -- on this report, and I can't remember who did
the bulk of the work, but I was certainly involved
in it.
Q. Is it fair to say that both of
you -A. Yes.
Q. -- had substantial input in
preparing this report?
A. (Witness nods head.)
Q. I need a verbal answer.
A. Yes. Sorry.
Q. We need a verbal answer for the
record.
A. Yes.
Q. Do you see in -- towards the middle
of the page, a list of attendees with the meeting
with Bernie Madoff on August 4th, 2003?
A. Yes.
Q. And who were those attendees?
A. Manuel Echeverria, Steve Seneque,
James Woodyatt, myself and Jonathan Clark.
Q. And who was James Woodyatt?
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and it's on file. Therefore, I would believe it

is.
Q. As -- as -- was it your practice to
delete drafts?
A. We didn't have drafts, inasmuch as a
document would be worked on and then you would
carry on working on it, save over what you had
done. So, effectively, yes, but practically no,
because there weren't any -- there was only one
working document which evolved.
Q. And when you say "saved", you're
referring to saved on the computer system;
correct?
A. Yes.
Q. There was a shared drive?
A. Yes.
Q. And the shared drive was accessible
by New York and Geneva?
A. No, just New York.
Q. Just New York. Did it -- strike
that.
Do you remember anything from the meeting
with Bernie Madoff about -- on August 4th, 2003?
A. I'd have to -- I don't specifically
remember what was discussed at it.
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A. He was a senior person responsible

for business development based in Geneva.
Q. Was he employed by Optimal?
A. Yes.
Q. Is it fair to say that he was on the
sales side?
A. Yes.
Q. And what was his title?
A. I don't recall.
Q. Was he a senior person or a junior
person, in general?
A. He -- he was a senior person. He
was the same level as me, approximately.
Q. And what is this report about?
A. It is a review of the work that had
been done and our understanding of the strategy,
and a summation also of the information that we
gathered at the meeting that took place.
Q. Were there drafts of this report?
A. I don't know.
Q. Is this the final version of the
report?
A. I believe so.
Q. And what gives you that impression?
A. It looks like a finished document
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Q. Do you remember how long the meeting

was?
A. No.
THE EXAMINER: Was this your first
meeting with him?
THE WITNESS: Yes.
BY MR. BLEICHMAR:
Q. Do you -- who was present -- I take
it you met with Bernie Madoff; correct?
A. Yes.
Q. Was there anybody else present from
his organization?
Q. And where did the meeting take
place?
A. In his offices.
Q. Is that at the offices at the -- in
the -- on the -- in the Lipstick Building?
A. Yes.
Q. And what was the purpose of the
meeting?
A. Periodic review and a chance for
myself and Jonathan to -- to meet him for the
first time and to ask questions that we may have
had, which would allow us to put together this
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report.
Q. And were you -- was there -- did
somebody lead the meeting from the SIS Optimal
side?
A. Mr. Echeverria.
Q. He did the principal talking?
A. Yes.
Q. And do you -- did you ask any
questions?
A. I believe I did. I don't recall
what they were.
Q. Did Jonathan Clark ask any
questions?
A. I'm not sure.
Q. And what did Mr. Echeverria say?
A. I don't recall.
Q. Do you recall what Mr. Madoff said?
A. No, not specifically.
Q. How about generally?
A. I recall the outline of the
conversation, describing the strategy and some of
the points that went into this -- into this note.
Q. And what was the strategy?
A. The strategy was to buy a basket
of liquid large cap U.S. equities listed in the
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S&P 100, and then to hedge that basket with a

proportionally weighted basket of put options,
equity put options, on the OEX, which is the
S&P 100 index, and to fund those puts with -by -- by the sale of call options on the OEX but
at different strikes.
Q. What was your impression of
Mr. Madoff?
A. He was a very comfortable,
confident, unassuming, slightly older than a
number of the hedge fund managers we typically
saw, but, I mean, nothing particularly remarkable
about him.
Q. Had you heard of him beforehand?
A. Yes.
Q. And what had you heard?
A. I knew that he ran the strategy,
I knew of the existence of the SUS strategy which
was invested with him. So I knew of his -his existence and -- and his prominence.
Q. When you say "prominence", what are
you referring to?
A. Well, there are a number of very
large hedge fund managers in the industry.
I'd been a participant in the industry for a
number of years, and I was aware of his position,

just as much as I was aware of a number of other
hedge fund managers' positions, and -- and I had
read these notes before I went in to go and see
him, so, you know, I knew a good deal about the
shape of -- of what I was expecting to see.
MR. DRAKE: You say if you need a break.
THE WITNESS: I'm fine at the moment.
MR. BLEICHMAR: We can take a break
whenever you like.
THE WITNESS: No, I'm fine. I'm sure
I will do at some point, but I'm okay at the
moment, unless anybody else does.
MR. BLEICHMAR: Let me mark as exhibit 7
a document bearing Bates stamps 1263136.
BY MR. BLEICHMAR:
Q. Are these your notes?
A. No.
A. Not with certainty.
Q. Why -- why do you say that? Do you
have a -A. Well, there's -- there's no name or
anything else on them.
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Q. Do you have a reasonable

understanding -A. I don't recall seeing them. I'm not
sure I ever -- ever have seen them before.
Q. Do you have any reasonable basis to
understand whose they are?
A. Again, I would hazard a guess, an
informed guess.
Q. I don't want you to guess. That's
fine.
exhibit 8 a document bearing Bates stamp 1263120.
BY MR. BLEICHMAR:
Q. And, again, I'm going to ask -first ask you whether these are your notes?
A. They are not.
Q. Do you have a reasonable
understanding as to whose notes they are?
A. A similar response to the last set,
so I can hazard a guess, an informed guess.
Q. Did you take notes at the meeting?
A. I believe I did.
Q. Do you know what you did with those
notes?
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A. I would have taken them back to the

office and kept them in my notebook.
Q. And would the notebook -- did you
put the notebook in the file of SUS?
A. No.
Q. And why not?
A. I kept it for a long period
afterwards, but all of my notes were -- were
written up into formal documents.
Q. So your notes are reflected in the
formal documents created while -- at your time at
SIS?
A. Yes.
Q. What did you do with that notebook?
A. I don't know.
Q. Do you still have that notebook?
Q. Did you -- do you know if you left
it at SIS after you finished your employment
there?
A. I think I took it with me.
Q. Other than your notes, your
handwritten notes, did you keep any other records
of your meeting with -- the meeting with
Mr. Madoff that you participated on in August of
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2003?
MR. DRAKE: Sorry, before you answer,
can you repeat the question, read it back?
(Record read.)
THE WITNESS: No. Everything was
recorded into formal documents that went onto the
file server.
BY MR. BLEICHMAR:
Q. The meeting was not recorded,
tape recorded?
A. No, not tape recorded.
THE EXAMINER: At least from your side.
THE WITNESS: Not that I'm aware of.
MR. BLEICHMAR: I'm going to mark
as document -- excuse me, I'm going to mark as
exhibit number 9 a document bearing Bates stamp
3770438.
BY MR. BLEICHMAR:
Q. Do you see that this document
reflects an email from you to Mr. Echeverria and a
number of additional recipients, including
Mr. Clark -A. Mmm-hmm.
Q. -- dated November 18, 2003?
A. Yep.
Q. Did you send this email?
A. Yes.
Q. Did you send it as part of your
general responsibilities while employed at SIS?
A. Yes.
Q. Do you have any reason to believe
that this is not an authentic copy of the
document?
A. No.
Q. Do you see the first sentence says:
"We just had a long and extremely
positive conversation with Rafael Mayer ..."
A. Mmm-hmm.
Q. Let me refer you to what I think was
marked previously as exhibit number 2.
A. Yep. This one, yep.
Q. Do you see that exhibit number 2 in
the top right-hand corner says "Conversation with
Rafael Mayer"?
A. Yes.
Q. Does exhibit number 9 refresh your
recollection as to whether you were a participant
at the conversation with Mr. Mayer?
A. Yes, although there were more than
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one conversation with -- with Rafael Mayer.

We saw him and we met with him on -- on more than
one occasion.
Q. Let's talk about that. Who was
Mr. Mayer?
A. He was the principal of a firm
called Khronos.
Q. How do you spell that?
A. K-H-R-O-N-O-S.
THE EXAMINER: K-H?
THE WITNESS: K-H.
MR. DRAKE: No "H"?
THE WITNESS: Sorry?
MR. DRAKE: No "H"; "H"?
THE WITNESS: I think there was an "H"
in there, but I might be wrong.
BY MR. BLEICHMAR:
Q. Was the "H" relevant to its
investment strategy?
A. You'd have to ask Mr. Mayer.
Q. You don't have to -- you don't have
to answer that question.
What -- what was Khronos' general
investment strategy?
A. It was a diversified alternative
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investments manager.
Q. Did Khronos utilize the -- the split
strike conversion strategy?
Q. Did it employ a strategy that was
similar to the split strike conversion strategy?
A. No; not that I'm aware -- not that
I'm aware of.
Q. You said you had multiple
conversations with him; is that correct?
A. Yes.
Q. This email appears to refer to only
one conversation; is that right?
A. Yes.
Q. Do you see, in the second full
sentence of the first paragraph, it says:
"Given Clinton's problems it seems that
nervous investors are looking around at the next
big thing and wondering if there could be a
problem with it - Madoff is an obvious target."
A. Mmm-hmm.
Q. What were you referring to when you
said "Clinton's problems"?
A. Clinton was a hedge fund in New York
that operated a mortgage-backed trading strategy,
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amongst other strategies, and they had experienced

a sharp draw-down in one of their funds and then
were subsequently investigated by the SEC,
or I think they called in the SEC, but they were
involved with the SEC in some form of
interaction/investigation.
Q. Was there a fraud involved with
Clinton?
A. No, I think the SEC cleared them.
Q. At the end of that sentence, you
say:
"... Madoff is an obvious target."
Do you see that?
A. Yes.
Q. Why -- what did you mean by that?
A. There was always -- the industry was
always looking around for someone where there
might be problems. Rumors persist in financial
markets. And Madoff was prominent. We'd just
witnessed an event where a large otherwise
successful hedge fund had run into trouble. That
typically makes investors nervous, and when
investors get nervous, rumors start.
Q. And when you said "obvious target",
what did you mean by that?
A. He was a very large operator in the

hedge fund space.
Q. When you say "rumors start", were
there rumors about Madoff?
MR. DRAKE: In -- in the context of this
conversation?
MR. DRAKE: Yes.
THE WITNESS: I mean, no, not rumors of
anything untoward, if that's what you mean, but
there were always -- there were questions about
how he was so successful and how his strategy
delivered such good results.
BY MR. BLEICHMAR:
Q. And what kind of questions were
those?
A. Well, "How does he do it?", was
the -- the question.
Q. And when you say, "How does he do
it", you're referring to how does he generate such
successful results?
A. Yes.
Q. Is that what you're referring to?
THE EXAMINER: We're done with that one?
MR. BLEICHMAR: Yes. Let me mark as
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exhibit 3099621 -- strike that.

Let me mark as exhibit number 10 a
document bearing Bates stamp 3099621.
MR. DRAKE: What's the date of it?
MR. BLEICHMAR: It's dated -- it
reflects an email from Mr. Burnaby-Atkins dated
June 16th, 2004 to Mr. Echeverria, Mr. Clark,
Mr. Bastianpillai and Mr. Poiret and Mr. Seneque.
MR. DRAKE: Thank you.
BY MR. BLEICHMAR:
Q. Do you see that this appears to be
an email from you to a number of recipients?
A. Yes.
Q. And is this an email that you sent?
A. Yes.
A. Yes.
believe that it is not an authentic document?
A. No.
Q. Who was Mr. Caron Bastianpillai?
A. He was a senior analyst based in
Geneva.
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Q. Did he have responsibilities for

SUS?
A. Not while I was there.
whether he had responsibilities subsequently to
your departure?
A. Not subsequently, no. He departed
the same time as I did.
Q. Did he have any responsibilities at
any other time over SUS?
A. I don't know.
Q. Who was Mr. Sebastien Poiret?
A. He was an analyst based in New York,
initially. He then moved to Geneva.
Q. And what were his responsibilities?
A. He was focused on trading
strategies.
Q. And did he have any responsibilities
for SUS?
A. No.
Q. Without getting into the substance
of the email, which I will get to in a second, did
you receive a response email to this -- to your
email?
A. No.
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Q. And how do you know that?

A. I'm pretty sure I didn't.
Q. You see that this email refers to
a -- in the first sentence, it says:
"SPO and I saw an interesting fund
yesterday - Telluride ..."
A. Yes.
Q. Who is "SPO"?
A. Sebastien Poiret.
Q. So you had a meeting with Telluride;
is that correct?
A. Yes.
Q. Do you remember that meeting?
A. Yes.
Q. And that meeting took place on or
about June 15th, 2004?
A. I think so.
MR. BLEICHMAR: I have marked as
through 294.
BY MR. BLEICHMAR:
Q. Have you seen this document before?
A. I think so.
Q. And did you see it prior to --
during your employment at SIS?

A. Yes.
Q. What is this document?
A. It is a summary of a call that
Jonathan had with Frank DiPascali.
document?
A. No.
Q. When you say "Jonathan", you're
referring to Jonathan Clark?
A. Jonathan Clark.
Q. And who was Frank DiPascali?
A. He was a senior person within
Madoff's organization.
whether Mr. DiPascali was part of the fraud
conducted by Madoff?
A. My understanding is that he was part
of that fraud.
Q. And what was your understanding of
his role?
A. I understood him to be a -an important person in the back office of Madoff's
organization.
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Q. Did you -- did you participate in

this call?
A. No.
Q. Did you discuss this call with
Mr. Clark?
A. I -- I think I did, yes.
Q. And what gives you that impression?
A. Jonathan and I discussed most things
in relation to SUS.
Q. And did you have any specific
recollection about discussing this particular call
between Jonathan Clark and Mr. DiPascali?
A. Not -MR. DRAKE: You mean -- you mean "do
you"?
THE WITNESS: No, I don't -- I don't
recall specifically.
BY MR. BLEICHMAR:
Q. Turning to the second page, do you
see where it says "Comments"? The first sentence
says:
"Frank is warming up a bit and released
some interesting info ..."
A. Mmm-hmm.
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Q. "... most notably on how much their

liquidity advantage contributes to returns."
A. Yes.
Q. Did you discuss that with Jonathan?
A. Probably.
Q. Do you remember specifically whether
you discussed that with Jonathan?
A. I'm going to say yes, because we
discussed everything and we chewed over ideas and
we turned over pretty much every piece of
information that came our way.
So it's reasonable to assume that the
answer is yes.
MR. DRAKE: But that wasn't -THE WITNESS: I don't recall it
specifically.
MR. DRAKE: That wasn't the question.
The question was: do you recall discussing that
specifically?
THE WITNESS: Not specifically.
BY MR. BLEICHMAR:
Q. Do you see the prior bullet point,
above "Comments", where it says:
"We have an inside look into the market
by handling 4-5% of ..."
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A. It's on the second page.

Q. Yes, at the top of the second page,
the bullet point that reads:
by handling 4-5% of daily stock volume - 250,000
trade tickets a day, of which 80% are listed
stocks. This allows me to observe the size
buildup of positions."
Do you see that?
A. Yes.
Q. The part that says "this allows me",
is it your understanding, or was it your
understanding at the time, that this meant that it
allowed Mr. DiPascali to observe the size build-up
of positions?
A. I don't know. I -- I don't know.
Q. When -- at the beginning of that
bullet, where it says, "We have an inside look
into the market by handling 4-5% of daily stock
volume", is it your understanding that "we" refers
to Mr. DiPascali and Mr. Madoff?
A. Well, it's the understanding that
it's the broad Madoff organization.
THE EXAMINER: It looks as though it's
an answer to the bullet point question on the
previous page.
MR. DRAKE: Yes, and I think that's the
fairer way to -MR. BLEICHMAR: Oh, I apologize. So let
me just make the record clear.
THE EXAMINER: Everything else is -- is
in the form of a bullet point question followed by
an answer, so it looks like this is the same.
MR. BLEICHMAR: So -- correct.
BY MR. BLEICHMAR:
Q. So the -- the bullet point asks the
question:
"What makes the trade unique to Madoff?
Why can't others do it?"
And the response is -- or what appears to
be the response -- what appears subsequently to
the question says:
by handling 4-5% of daily stock volume - 250,000
trade tickets a day, of which 80% are listed
stocks. This allows me to observe the size
build-up of positions."
You see that; right?
A. Yes.
Q. Does that change any of your prior
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answers?
A. No.
Q. Thank you.
MR. BLEICHMAR: I have marked as
through 292.
BY MR. BLEICHMAR:
Q. Do you see that the top of the page
says "Madoff Securities. JCL call with [an
individual]" and then "Fairfield Greenwich Group"?
A. Yes.
A. Yes.
Q. Do you -- did you see this document
during your employment at SIS?
A. Yes.
Q. And did you see this document as
part of your general responsibilities at SIS?
A. Yes.
copy?
A. No.
Q. And what does this document purport
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to be? What is your understanding of what this

document purports to be?
A. It is a record, a note, from a
telephone conversation that took place between
Jonathan Clark and the individual at Fairfield
Greenwich Group.
Q. Shall we refer to that individual as
"Amit"?
A. "Amit", yes.
Q. And what is your understanding of
who Amit was?
A. I understood him to be Jonathan's
equivalent at Fairfield Greenwich Group.
Q. And what is your understanding as to
why Jonathan was having a -- let me -- let me
strike that.
Did you participate in this call?
A. No.
Q. What was your understanding as to
why Mr. Clark was having a conversation with
Mr. Amit about Madoff Securities?
A. It was not uncommon for us to
discuss how we approached our work with peers in
the industry, to understand how they were doing it
and see if there was anything we could learn
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duties with care and attention.

Q. Did you have any conversations with
Amit?
A. No.
Q. Never?
A. No.
Q. Let me direct you to the last page
of this exhibit, towards the bottom of the page,
where it says "Follow-up questions". Do you see
the second question says:
"How frequent are the SEC's checks and is
this information available?"
A. Yes.
Q. What did that mean to you?
MR. DRAKE: At the time.
BY MR. BLEICHMAR:
Q. At the time.
A. At the time, it's a question that
appeared to be unanswered, and it was one that we
might usefully ask.
Q. When there it says, "Is this
information available?", what was your
understanding of what that meant?
A. Is it publicly available? Can we
get hold of it?
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from -- from their work that might help -- that

might help us in ours.
Q. When you say "peers in the
industry", was Fairfield Greenwich Group a peer
to -- to who?
A. To the Optimal group. It was
different in a number of respects, but it was
similar in the -- to the extent that it had a -a fund which invested with Madoff.
Q. So Fairfield also had what's
commonly described as a feeder fund with Madoff?
A. Yes.
Q. And is it your understanding that
Amit was the person responsible, or at least had
some responsibilities, at Fairfield for the fund
that Fairfield had with Madoff?
A. Yes.
Q. Did you have any conversations
with anybody at Fairfield with respect to
Madoff Securities?
A. No.
Q. Why not?
A. I felt that Jonathan was doing a -a good job and was satisfied that his work was of
high quality and that he was discharging his
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Q. Was it publicly available?

A. I don't recall.
Q. Do you recall whether "we got a hold
of it"?
A. I don't recall. I don't -- don't
recall.
THE EXAMINER: Sorry, you don't think
you did?
THE WITNESS: I don't recall.
THE EXAMINER: Or you just don't recall?
THE WITNESS: I don't recall.
MR. BLEICHMAR: Let's go off the record.
THE EXAMINER: Okay.
MR. DRAKE: Go off the record for a
break?
MR. BLEICHMAR: Yeah, I mean, we've gone
an hour and a half. Let's take five minutes.
THE VIDEO OPERATOR: This marks the
end of tape 1 in the deposition of
Hugh Burnaby-Atkins. Going off the record. The
time is 10.31 a.m.
(10:31 a.m.)
(Break taken.)
(10:43 a.m.)
THE VIDEO OPERATOR: Back on the record.
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Here marks the beginning of tape number 2 in the

deposition of Mr. Hugh Burnaby-Atkins. The time
is 10.43 a.m..
BY MR. BLEICHMAR:
Q. I have marked as exhibit 13 a
document bearing Bates stamped 136495 through 499,
and I'm only going to ask you about the emails
that you are -- that you are on, and,
specifically, I'm going to focus on the email at
the bottom of page 1 that carries over to page 2.
A. Mmm-hmm.
Q. Do you see that the email at the
bottom of page 1 is from you, dated April 22nd,
2005 -A. Yes.
Q. -- to Mr. Clark and a number of
other recipients?
A. Yes.
A. Yes.
responsibilities while employed at SIS?
A. Yes.
Q. Is this a -- any reason to believe
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that this is not an authentic -A. No.

Q. -- copy of this document?
A. No.
Q. What is this email about?
A. It is about the process of gathering
audit reports on underlying hedge funds.
Q. And -- and why did you send this
email?
A. It appears to be in response to
another email suggesting that those reports
weren't in place.
Q. And when you say "those reports",
you mean audit reports?
A. Audit reports, yes.
Q. And you see that you begin your
email by saying, "This is very important"?
A. Mmm-hmm.
Q. And why was this very important?
A. Because reviewing all elements of a
fund's operation was very important.
Q. And audit reports is one of the
elements of a fund's operation?
A. Yes.
Q. Is audit reports one of the elements
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that was reviewed with respect to Madoff?

A. Yes. However, he was a private
company and, therefore, didn't publish an audit
report, so there's -- there's a more complicated
answer to that question.
Q. Were audit reports still important
with respect to Madoff?
A. Yes.
Q. And why is that?
A. Well, in the Madoff situation,
the fund was a -- an Optimal fund. Therefore,
it was Optimal's responsibility to produce -or the fund's responsibility to produce the audit
report. Rather than to gather a report, it's our
responsibility to produce a report, or to instruct
a report to be produced.
Q. Are you, in your answer, making a
difference between the audit report of the
Optimal SUS fund, compared to the audit of Madoff?
A. Yes.
Q. And why are you making that
difference?
A. Because one relates to the fund and
one relates to the corporate entity.
Q. Let's focus on the -- let's focus on
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the fund -- on the auditors of Madoff.

A. Yes.
Q. Are the auditors of Madoff also
important within the context of this email?
MR. DRAKE: Sorry, I don't understand
that question.
BY MR. BLEICHMAR:
Q. Do you understand the question?
A. No, they're not, in the context of
this email.
Q. They're not -A. That is not what this is referring
to.
Q. Okay. So what is this email
referring to?
A. This is referring to audit reports
on funds.
Q. So, in other words, audit reports on
what would be the equivalent of Optimal SUS?
A. Yes.
Q. And why is this email not referring
to the audit reports on Madoff?
A. Because this is referring to
Optimal, or one of its fund of funds, investing
into a third party fund and us wanting to get the
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audit report of that third party fund sent to us.

That's what this email refers to.
Q. Okay.
A. In the case of Madoff, we were the
fund and we would be -- or the fund would be
sending out the report, so there was a -- reports
going in totally different directions. This is
about reports coming in to us, rather than reports
going out.
Q. Putting aside this email, is it your
view that the audit reports on Madoff by Madoff's
auditors are important to the due diligence
process of Optimal SUS?
MR. DRAKE: Don't answer. You need to
ask that question in the past tense for it to be
permissible.
THE EXAMINER: "Were important".
BY MR. BLEICHMAR:
Q. Is it your view that the audit
reports on Madoff by Madoff's auditors were
important to the due diligence process of Optimal
SUS?
A. Yes.
Q. And why is that?
A. Because we wanted to get every piece
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of information that was available to us, or

potentially available to us, in order to
understand how good his systems and controls were.
Q. And the audit reports on Madoff
provided you some of that information concerning
Mr. Madoff's systems and controls?
A. They were not available to us,
however.
Q. The audit reports on Madoff were not
available to you?
A. No. It was a private company.
Q. Did you ever obtain those audit
reports on Madoff?
A. I believe we got hold of some
documents, but I'm not sure of specifically which
those were.
Q. And what gives you the belief -or what's the basis for your belief that "we got
hold of some documents"?
A. He was obliged to publish some
information publicly, but given that he was a
private company and his auditor was auditing a
private company, that information was private.
Q. Did you request from Madoff that
Madoff provide you or Optimal a copy of the
audit reports?
A. I don't recall a specific request
for that, for -- for the reports themselves.
Q. So you don't know, one way or the
other, whether a request was made of Madoff for
Madoff's audit reports?
MR. DRAKE: Well, no, no, be careful.
The first question you asked is whether he had
made a request, and then you've ramped it up to a
general question as to whether there was any
request.
BY MR. BLEICHMAR:
Q. Do you understand my question,
Mr. Burnaby-Atkins?
A. I understand your question.
Q. Can you please give me an answer to
the question?
A. I'm not sure whether a broader
request was made.
Q. Thank you. Was it -- you stated
that you had certain responsibilities with respect
to SUS; correct?
A. Mmm-hmm. Yes.
Q. Was it -- was it within your
responsibilities with respect to SUS while you
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were employed at SIS to make a request of Madoff

for Madoff's audit reports?
A. It was not a formal responsibility.
Q. What kind of responsibility was it?
A. Sorry?
Q. What kind of responsibility was it?
A. It was something that one might
potentially do as part of being extremely
diligent, careful and -- and rigorous in one's -Q. Is that something that you did?
A. We -- I have already answered that
question. I don't recall making a specific
request.
Q. Fair enough. Fair enough.
THE EXAMINER: You did say that he was
obliged to publish some information.
THE WITNESS: Yes.
THE EXAMINER: By whom?
THE WITNESS: I can't remember exactly
what that was. I'm sure that you will be able to
refresh my memory. There was a report which he
would publish -- which he did publish.
THE EXAMINER: On an annual basis?
THE WITNESS: On an annual basis.
I can't remember the exact name of it. I think it
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was "scope report", possibly.

MR. BLEICHMAR: For evidentiary purposes
in the United States, the plaintiffs reserve all
objections to any questions not posed by
plaintiffs' counsel.
THE EXAMINER: You can get them all
taken out, if you want. It's happened before.
MR. BLEICHMAR: I just want to make
sure -- I just want to make sure I don't waive
anything.
I'm going to mark as exhibit 14 a
document bearing Bates stamps 406682 through 693.
MR. BLEICHMAR: The date is August 2003.
THE WITNESS: Didn't we see this
already?
BY MR. BLEICHMAR:
Q. That is my question to you,
truthfully.
MR. DRAKE: It's the same as 6, isn't
it?
BY MR. BLEICHMAR:
Q. Is this a draft or a different
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version than exhibit 6, or is it your

understanding this is another copy?
A. I don't know.
Q. From the format, is it your
understanding that this format refers to -or suggests to you that it's a final copy?
A. They appear to be identical.
Q. And this is the -- this is the
format that suggests to you that these are final
copies of the document; correct?
A. Yes.
Q. Thank you. You can put that aside.
through 436.
BY MR. BLEICHMAR:
Q. And I'm going to focus on the email
from -- the second email from the top on the first
page, from Mr. Echeverria to Mr. Clark, on which
you are copied; do you see that?
A. Mmm-hmm. Yes.
Q. And do you see that that email was
sent on July 29th, 2005?
A. Yes.
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Q. Did you receive that email?

A. Yes.
Q. Did you receive this email in -as part of your responsibilities at SIS?
A. Yes.
Q. Is -- do you have any reason to
believe that it is not an authentic copy of that
email?
A. No.
THE EXAMINER: Sorry, which -- which
particular one are you focusing on?
MR. BLEICHMAR: The one -- thank you,
the one July 29th, 2005 at 9.38 a.m..
THE EXAMINER: So from Manuel to Clark,
copied to this witness?
BY MR. BLEICHMAR:
Q. For the purposes of authentication,
let's move on, and I'll come back to the
substance, to page 432, which is the second page
of that document.
Do you see there's an email that begins
on that page from you, dated July 28, 2005, at
2.33 --
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A. Yes.
Q. -- to Mr. Jaitly, with Mr. Clark as
a copyee?
A. Yes.
Q. Did you send that email?
A. Yes.
responsibilities while employed at SIS?
A. Yes.
that it is not an authentic copy?
A. No.
Q. Going back to the email on the first
page, of July 29, 2005, at 9.38 a.m., do you see
that Mr. Echeverria says:
"Dear Jonathan,
"I would like to attend all meetings with
Madoff. He is the only manager I require that
from, particularly if we take Rajiv along."
A. Yes.
Q. Was that the case, that
Mr. Echeverria required that he attend all
meetings with Mr. Madoff and that that was the
only manager he required that from?
A. That's what he says.
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Q. Do you have any reason to dispute

that?
A. No, except that we -- did we visit
him without -- I mean, there may have been -there were occasions, I think, where we visited
him without Mr. Echeverria, but he -- what he
was -- well, I'll leave it at that.
Q. But at the time, it was -strike that.
through 984, and it's dated September 6, 2005.
BY MR. BLEICHMAR:
Q. Do you see that the first page
appears to reflect an email from you to
Mr. Echeverria dated September 6, 2005?
A. Yes.
Q. And do you see that under
"Attachments" it bears an entry that says
"Madoff final.doc"?
A. Yes.
A. Yes.
Q. Did you send this email as part of
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your responsibilities while employed at SIS?

A. Yes.
Q. Did -- do you have any reason to
copy of the email?
A. No.
Q. Turning to the second page of the
exhibit, the text of the email says:
"Manuel
"Please see this excellent report done by
Claire Ikeda Thew."
Do you see that?
A. Yes.
Q. What did you mean by that?
A. I thought that her work was of very
high quality, and she'd been very rigorous and
thorough in discharging her duties.
Q. And you're referring to the
attachment that begins on the next page,
entitled "Madoff Securities" -A. Yes.
Q. -- and dated August 2005?
A. Yes.
Q. And is this the report -- strike
that.
Earlier today, we discussed an email in

which Ms. Thew had forwarded you an outline or a
draft of a report?
A. Correct.
Q. Does this report reflect the final
version of that report?
A. It does.
Q. Did you -- were there drafts of this
report prior to the final version?
A. I'm not sure. We saw one draft of
it that we -- we looked at earlier on, so the
answer is yes, in that sense, but whether there
were others beyond that, I don't know.
Q. And the one you're referring to is
what is marked as exhibit 1?
A. Yes.
Q. Are you aware of any other drafts,
other than what you see as exhibit 1?
A. I don't recall.
Q. Did you -- was this an iterative
process, where you provided comments to Ms. Thew,
or is this the first time that you saw the report
after you had seen the draft in May of 2005?
A. No, it was an iterative process.
Q. I'm sorry?
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A. It was an iterative process.

Q. And how did that iterative process
work? Did she give you written versions that
ended up being a final product?
A. I'm not sure, but there were a
number of conversations had with her over a period
of time about what she was working on, who she was
talking to and where she might usefully make
further inquiry.
Q. How many conversations,
approximately, did you have with Ms. Thew in
connection with this report?
A. I don't know, but she was present
with us for a number of weeks, so quite a few.
Q. Do you remember any one conversation
specifically?
A. No.
Q. Do you remember the conversations
generally?
A. Yes.
Q. And what do you remember about those
conversations?
A. I remember talking to her about who
she could phone up, who she was phoning up, and
some of the points that were coming out of what
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she was finding out.

Q. And who was she phoning up?
A. She'd phoned up a professor,
for example, which was a different angle of
inquiry from one that we had pursued previously,
going after an academic, someone theoretical in
the field.
She'd done some very good work in -in -- in expanding Bernard Madoff's biography,
amongst other things. So those types of things,
for example.
Q. Other than the professor, anybody
else that she phoned up?
A. I'm looking at the note.
She obviously spoke to Frank DiPascali.
MR. DRAKE: Sorry, he's not asking you
whether, on looking at the note, you can see
whether she did; he's asking you whether you
recollect at the time.
THE WITNESS: I'd have to read it.
I don't recollect in -- in any more detail than
that.
BY MR. BLEICHMAR:
Q. You mentioned that you also
discussed some of the points that were coming out
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of what she was finding out. What do you recall

specifically about that?
A. That they were -- there was nothing
conclusive about Madoff's activities or operations
one way or the other; that it was still opaque how
he successfully operated his strategy; and that,
therefore, she needed to keep going in order to
try to understand it better.
Q. And when you say she needed to keep
going, is that a project that took her the entire
summer?
A. Yeah, she was -- she was occupied
with this for -- for quite a period of time.
Q. And in her time at Optimal during
that summer, roughly what percentage of her time
did she dedicate to this report?
A. Oh, I don't know, 40 percent.
Q. Does this report reflect -- do you
understand this report -- and by "this report",
I'm referring to exhibit 16. Do you understand
this report to reflect the conclusions of that
analysis by Ms. Thew?
A. Yes.
Q. Was there anything in her report
about Madoff that you did not already know?
A. There were some points on

background, certainly, but otherwise -- a lot of
it we'd discussed along the way, so I don't think
it came as news when it went into writing, but
there was -- she certainly uncovered -- covered
new ground.
Q. And what new ground did she uncover?
A. On reading the report or on
recollection?
MR. DRAKE: All of the questions that
you are being asked are, or should be, directed
towards your recollection at the time.
BY MR. BLEICHMAR:
Q. And to the extent the report
refreshes your recollection -MR. DRAKE: Well ...
BY MR. BLEICHMAR:
Q. -- you can answer.
Let me rephrase that. Let me move on to
the page Bates stamped 982.
Do you see the paragraph that starts -that starts with, "Although both the NASD and
SEC"?
A. Yes. Yes.
Q. And do you see that sentence that
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states:
"Although both the NASD and SEC perform
routine compliance checks on broker dealers a few
times a year, the recent Bayou scandal highlights
just how superficial these checks can be."
A. Yes.
Q. Did you tell Ms. Thew that you
disagreed with that statement?
A. I don't recall.
Q. Did you tell anyone that you
A. I don't recall.
Q. You thought the report was
excellent, didn't you?
A. I thought it was very good.
Q. Let me refer you to page 983.
Do you see, three-quarters down the page, the
paragraph that begins with the bolded letter -word "Concern"?
A. Yes.
Q. Do you see that that paragraph says:
"Concern: All checks and balances appear
to use a single source document, generated by
Madoff - Optimal, PwC (auditor), and HSBC
(administrator) all use the same monthly
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statements/trade tickets sent by Madoff."

Do you see that?
A. Yes.
A. No.
Q. Moving on to page 984, which is the
next page, do you see in the full -- in the full
paragraph at the top, in the third sentence, it
says:
"Regulatory oversight provides some
comfort, but the recent Bayou scandal is a
reminder of the fact that fraud really does
occur."
A. Yes.
A. No.
Q. Moving on to -- do you see there's a
number -- there's a number of points that are
numbered in that page -- on that page?
A. Yes.
Q. Do you see point number 1, it says:
"At the next Madoff meeting, try to meet
the team members responsible for
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maintaining/building the model. To determine that

they exist and they are competent would be
reassuring and increase Madoff's credibility."
A. Yes.
Q. Did you disagree with that
statement?
A. No.
Q. At the next Madoff meeting, did you
meet the team members responsible for
maintaining/building the model?
A. No -- well, yes, because that was
Mr. Madoff, as we were led to believe.
Q. Other than Mr. Madoff, did you meet
anyone else?
A. We were not given to believe there
was a team.
THE EXAMINER: Sorry, you were not?
THE WITNESS: We -- we were -- we were
led to believe there was no team; that Madoff
himself had constructed the -- the model.
BY MR. BLEICHMAR:
Q. Was it your understanding that
Madoff himself constructed and operated the model?
A. Yes.
Q. Was it your understanding that
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Bernie Madoff himself was the only person that

operated the model?
A. Yes.
Q. And did you obtain -- go ahead.
A. Well, "operated", I mean, bear in
mind, Frank DiPascali was the operation, so the
back office piece of it, but the model itself and
the signals it generated was Mr. Madoff's sole
reserve.
The outputs, as in when to trade, were
then handed to Mr. Pascali, who then executed the
trades, so that -- there's a subtle difference
there, but perhaps that explains -Q. Understood.
A. -- with a bit more clarity.
Q. That's helpful, thank you.
Was it your -- strike that.
On point number 2, beginning with the
second sentence, can you see where it says:
"At the moment, PwC's audit relies
entirely on Madoff-produced documentation.
PwC compares Madoff's monthly customer statement
with the administrator (HSBC)'s statement.
However, the latter is directly derived from
Madoff-provided documentation, so nothing is
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really being independently verified."

Do you see that?
A. Yes.
A. No.
Q. Did you ever -- strike that.
Did Optimal, to the extent you know, ever
independently verify Madoff's produced
documentation?
A. No. Not that I'm aware of.
Q. On point number 3, the first
sentence says:
"Look into ways to independently verify
the existence of Optimal's brokerage account at
Madoff ,and the net asset value it contains."
Do you see that?
A. Yes.
Q. Did you agree with that statement?
A. Yes.
Q. Did you ever independently verify
the existence of Optimal's brokerage account at
Madoff?
A. We sought to.
Q. Did you ever actually independently
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verify it?
A. No. We were unable to. We tried.
Q. Going back to point number 2, and
this is going to be a little repetitive, but
slightly different, again, let me quote from the
second sentence, which says:
"At the moment, PwC's audit relies
entirely on Madoff-produced documentation.
PwC compares Madoff's monthly customer statement
with the administrator (HSBC)'s statement.
However, the latter is directly derived from
Madoff-provided documentation, so nothing is
really being independently verified."
Do you see that?
A. Yes.
Q. Do you agree with that statement?
MR. DRAKE: Isn't that precisely what
you asked him?
MR. BLEICHMAR: No, it's not.
THE WITNESS: I do -- I do agree with
it. One could argue it, but I agree with it.
BY MR. BLEICHMAR:
Q. Thank you.
MR. BLEICHMAR: Let me mark as exhibit
number 17 a document bearing Bates stamps 82078
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through 82079.
BY MR. BLEICHMAR:
Q. That's dated September 6, 2005.
Excuse me, it's dated September 8, 2005, and
there's a subsequent email dated September 6,
2005.
Do you see that -- I'm going to focus on
the bottom email. Do you see there's an email
from you dated September 6, 2005 at 3.47 to
Claire Ikeda-Thew?
A. Yes.
A. Yes.
responsibilities at SIS?
A. Yes.
this is not an authentic copy of this email?
A. No.
Q. Do you see in the second sentence -in the second paragraph, excuse me, the first
sentence says:
"Thanks for a really first class report."
A. Yes.
Q. Did you believe that Ms. Thew's

report was a first-class report?
A. I thought it was very good.
Q. In the third paragraph, do you see
where it says in the first sentence:
"As I said, given the sensitivity, it
can't be released outside the firm."
A. Yes.
Q. Was the report, to the extent you
know, ever released outside the firm?
A. I don't know.
Q. Do you have any knowledge -when you say you don't know, you do not know that
it was ever released, but you also don't know if
somebody else -A. It's here today, but -- so somebody
was, but not during, you know, the -- the
time frame we're referring to.
Q. Thank you. What sensitivities were
you -- were you concerned about?
A. It was standard practice for all of
our research reports that they weren't released
outside the firm.
Q. And when you say they weren't
released, is it your understanding -- strike that.
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exhibit number 18 a document bearing Bates stamps
1912567 through 2568.
BY MR. BLEICHMAR:
Q. Do you see that this is -this document reflects an email from
Jonathan Clark dated November 21, 2005 to
Mr. Echeverria, and you are -- you are copied,
also Mr. Jaitly?
A. Yes.
Q. And is this an email you received?
A. Yes.
Q. Did you receive it in your
regular -- or as part of your responsibilities at
SIS?
A. Yes.
Q. Any reason to believe that you -that this document is not authentic?
A. No.
Q. Do you see in the first sentence
of -- strike that.
Do you see the subject of the email is
"Madoff auditors"?
A. Yes.
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Q. Who were Madoff's auditors?

A. A company called Friehling &
Horowitz.
Q. Do you see that the email says:
"We spoke to Friehling & Horowitz ..."
Did that include you?
A. I don't believe it did, on that
occasion. It was not unusual to use the "we" to
describe "we, the team", even though it might have
been an individual doing so.
Jonathan Clark spoke to Friehling & Horowitz?
A. Yes.
Q. Did you discuss the conversation
that Jonathan Clark had with Friehling & Horowitz
with him?
MR. DRAKE: At the time?
BY MR. BLEICHMAR:
Q. At the time.
A. Yes.
Q. What was the subject matter of that
conversation?
A. I don't know, because I don't think
I was on the call.
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whether Jonathan Clark is an auditor or is a CPA?

A. He's not a CPA, but he's a credit
analyst and an MBA and very financially literate.
Q. Are you a certified public
accountant?
A. I'm a certified -- or I am a
chartered holder of the certified -- sorry, the
chartered financial analyst designation. I'm not
a chartered accountant, but I have done a lot of
work both at -- during the three years I studied
for that exam and also the accountancy modules
I took at university as well.
Q. Let me direct you to the
third paragraph, the second sentence, the last
clause, where it says:
"... as auditors they are not aware of
any distinctions between client or other
accounts."
Do you see that?
A. Yes.
Q. What did -- what was your
understanding at the time of that statement?
A. I don't recall specifically that
point, and I also believed subsequently that -that that was -- was explained to us not to be the
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case, that they were segregated.

Q. When you say "it was subsequently
explained to us", was that explained to you by
Madoff?
A. Well, by his auditors.
through 22866.
MR. DRAKE: Nineteen?
BY MR. BLEICHMAR:
Q. And I'll represent to you,
Mr. Burnaby-Atkins, that the defendants produced
this document and represented to us that you were
the custodian of this document.
A. Okay.
THE EXAMINER: Sorry, that was -- you
represented to him that -MR. BLEICHMAR: The defendants produced
this document to us and represented to us that
Mr. Burnaby-Atkins was the custodian of this
document?
THE EXAMINER: Custodian?
MR. BLEICHMAR: That it was his
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document.
THE EXAMINER: I see, okay.
MR. BLEICHMAR: Or that he had
possession of the document.
BY MR. BLEICHMAR:
A. Yes, I do.
Q. And what do you recognize this
document to be?
A. I recognize it as a description of
our investment process for investing in -- into
hedge funds.
Q. Did you prepare this -- this
document?
A. Yes, I did.
Q. Did you prepare this document as
part of your responsibilities while employed at
SIS?
A. Yes.
believe that this document is not authentic?
A. No.
Q. And what was the purpose of this
document?
A. It was to help us improve our
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investment processes and make sure that we evolved

and developed and maintained best practice at all
times and, therefore -- I put this together to
describe the investment process, and it was as
much a description as a discussion document for
the other analysts in order to invite their
comment and to help us seek ways to get better
at -- at what we did.
Q. Can I refer to this document as a
presentation?
A. Yes.
Q. Is this presentation -- was this
presentation used only internally?
A. Yes.
Q. So this presentation was not used or
shown to any outside clients of Optimal?
A. I don't know. It was intended as an
internal document by me.
Q. Let me refer you to page 11, which
is Bates stamped 22846. Do you see that page 11
is entitled "Operational risk management"?
A. Yes.
Q. Was that the area that you
previously referred to as being more the
responsibility of Mr. Jaitly?
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A. Yes.
Q. Did Mr. Jaitly participate in the
preparation of at least this part of the document?
A. I believe I lifted things out of
other presentations that he had done and
incorporated them into this one, but this one was
designed for the investment team, this is the
investment process.
Q. And how did you use this
presentation?
A. I emailed it out to people. I can't
see a date stamp on when it went out -- oh,
December 2005.
So it was designed to encourage analysts
to try and work to a consistent pattern and
framework in the way that they approached their
investment research analysis and due diligence.
Q. Did anybody else participate in the
preparation of this presentation with you?
A. I don't know. I believe I lifted
components out of other presentations, so it was
an evolutionary presentation, rather than a
totally new body of work.
Q. Is this something that typically
Mr. Echeverria would assist you in preparing?
A. No.
exhibit number 20 a document bearing Bates stamps
53465 through 53466.
BY MR. BLEICHMAR:
Q. Do you see that in both of these
emails reflected on this page, dated January 18,
2006, you are a -- you are copied in the email?
A. Yes.
Q. And I'm not asking you about the
email -A. The last one I'm not copied, am I?
Q. -- on the second page. I'm just
asking you about the two emails on the first page.
A. Yes.
Q. You're copied in -- in -- in the
first email, you're the last copyee; right?
A. Yes.
Q. And you're also the last copyee on
the second email; correct?
A. Yes.
Q. And did you receive this email?
A. Yes.
MR. DRAKE: Which email?
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BY MR. BLEICHMAR:
Q. Did you receive these two emails?
A. Yes.
Q. Did you receive these two emails as
part of your responsibilities at SIS?
A. Yes.
that these -- that this copy is not an authentic
copy of these emails?
A. No.
through 169.
BY MR. BLEICHMAR:
A. Yes.
A. It's a record of a meeting that took
place with Bernard Madoff in February of 2006 at
his offices.
Q. Did you prepare this document?
A. No.
Q. Do you know who prepared it?
A. Yes.
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Q. Who prepared it?

A. Jonathan Clark.
Q. Did you receive or see a copy of
this document while employed at SIS?
A. Yes.
Q. And did you see or receive a copy of
this document as part of your responsibilities at
SIS?
A. Yes.
document?
A. No.
Q. You mentioned that this document is
a record of a meeting that took place with Bernie
Madoff in February of 2006; correct?
A. Yes.
Q. And who attended that meeting?
A. Rajiv Jaitly, myself and
Jonathan Clark.
Q. And what was the purpose of that
meeting?
A. It was for Rajiv, primarily, to
spend some time on site and to interview
Mr. Madoff.
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Q. Do you see at the top it says

"February 1, 2006"?
A. Yes.
that -- that that was the day -- the actual day of
the visit?
A. I think so.
when this particular document was prepared?
A. No. Soon, reasonably soon
afterwards.
Q. On page number 2, although it's not
numbered, it's Bates numbered 4168, do you see the
box titled "Managed accounts strategy"?
A. Yes.
Q. Do you see the fourth paragraph, it
begins with:
"BM expressed enthusiasm for the strategy
in 2006, mentioning that the model has been
'tweaked' recently on its signal generation
ability. The team of six people spent most of
2005 working on improving the models."
Do you see that?
A. Yes.
Q. Did you meet the team of six people
that spent most of 2005 working on improving the

models?
A. No.
Q. Is that -- is it your understanding
that that team of six people was the same team
that executed the trades with Mr. DiPascali that
you referred to earlier?
A. I'm -- I'm unclear on that.
Q. And why are you unclear?
A. In -- in the sense that -my understanding, as I already said, is that it
was Madoff, himself, alone, who operated the
strategy. He described other people assisting him
with that.
Here it refers to people working on
improving the models, but there was, to my
understanding, a sort of -- a -- an intentional
blurring, on the part of Mr. Madoff, about who was
involved with the models and who was involved in
executing the models, and it wasn't unusual for a
hedge fund manager not only to -- well, it wasn't
unusual for us not to meet a team in the first
instance, but it was also not unusual for a hedge
fund manager to -- to try and make something look
bigger than it actually was, so I didn't put a
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huge amount of store in that.

Q. But you never met the team of
six people; correct?
A. Not -- not the team of six people
that are referred to there, no.
[sic] through 093.
BY MR. BLEICHMAR:
Q. And I'm now going to ask you if you
recognize these notes, or whether these notes are
yours?
A. They're not my notes.
A. No.
Q. Is it possible they're -- the notes
are somebody else, other than Mr. Jaitly or
Mr. Clark?
A. It's possible; unlikely, but
possible.
Q. But they're not your notes?
A. Not my notes.
Q. When you were at the meeting, did
Mr. Clark take notes?
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A. I believe he did.
Q. Did Mr. Jaitly take notes?
A. I believe he did.
Q. Did you take notes?
A. I think so.
through 867.
BY MR. BLEICHMAR:
Q. Do you see that this is an email
sent from Mr. Jaitly to you dated October 13,
2006, and there's a number of other recipients?
A. Yes.
Q. And do you see that the subject is
"Madoff Securities" and there's an attachment
called "Madoff Securities.doc"?
A. Yes.
Q. Did you receive this email?
A. Yes.
Q. Did you receive the attachment?
A. Yes.
Q. Did you receive the email and the
attachment as part of your responsibilities while
employed at SIS?
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A. Yes.
Q. Did you -- do you have any reason to
believe that this is not an authentic copy of this
email and attachment?
A. No.
through 184.
MR. BLEICHMAR: It's dated June 2006.
BY MR. BLEICHMAR:
A. Yes.
A. It is a report prepared by
Jonathan Clark which summarized the work we had
carried out over the preceding years and was
designed as a formal handover document, if you
like, to the operational risk team.
Q. Did you participate in preparing
this report?
A. Yes.
Q. Would you say that you are the
primary author of this report --
A. No.
Q. -- or Jonathan Clark?
A. Jonathan Clark is.
Q. Did you receive this report as part
of your general responsibilities while employed at
SIS?
A. Yes.
Q. Do you have any reason to dispute
the authenticity of this document?
A. No.
Q. Before -- before discussing this
document, let me show you a slightly different
version. That way, we can compare them both
together.
A. Okay.
MR. BLEICHMAR: And I'm going to mark as
through 542.
BY MR. BLEICHMAR:
Q. Do you recognize exhibit 25?
A. Yes.
be?
A. I mean, it looks like the same
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document, so I'm not sure what the differences

are, but, essentially, a variation of the same
report.
Q. Did you receive or -- did you review
exhibit 25 while employed at SIS?
A. I'm not sure.
Q. And why are you not sure?
A. Because it's possible that Jonathan
kept a separate copy of one of them, and -- and
I would have seen a final version of it.
Q. Do you see that exhibit number 24 is
dated June 2006 and exhibit 25 is dated July 2006?
A. Yes.
Q. Does that give you an indication as
to which copy you saw?
A. I'm -- I think I saw both of them,
but I'm not sure what the differences are.
MR. BLEICHMAR: Let me mark as
exhibit 26 -- and keep both of those reports in
mind, or next to you -THE EXAMINER: Have you got -- have you
got yet another version of it?
MR. BLEICHMAR: No, we do not,
fortunately.
MR. DRAKE: Are there substantive
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differences between the two -- two documents?

MR. BLEICHMAR: We will go through them.
Yes.
document bearing Bates stamps 492044. It's dated
July 19, 2006.
BY MR. BLEICHMAR:
from Jonathan Clark to you, dated July 19th, 2006?
A. Yes.
Q. And you see that the subject is
U.S. -- "SUS report intro"?
A. Yes.
Q. And did you receive this email?
A. Yes.
Q. Did you receive it as part of your
responsibilities at -- at SIS?
A. Yes.
that this is not an authentic copy of this email?
A. No.
Q. Will you take a minute to read this
email closely, please.
MR. DRAKE: This is not something that
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we've seen before.

MR. BLEICHMAR: I apologize. That may
have been what we -- what I got yesterday.
THE WITNESS: Yes.
BY MR. BLEICHMAR:
Q. Now let's go back to exhibit 24 and
exhibit 25. Do you see that exhibit 24 does not
include the paragraph that Jonathan Clark includes
in his email of July 19th in exhibit 26 as
introduction?
A. The first one you gave me, so 24
doesn't include that paragraph, yes.
Q. Correct. And do you see that the
second one does include it?
A. Yes.
Q. Or includes a fairly -- a fairly
similar -A. Yes.
Q. -- version of the paragraph?
A. Yes.
Q. Does this refresh your recollection
as to what -- which one is the final version of
the report?
A. Yeah, the July one looks like the
final version of it.
THE EXAMINER: Well, it's a later

version.
THE WITNESS: Yes.
THE EXAMINER: Can you say whether it is
or is not the final version?
THE WITNESS: It looks like the final
version to me.
THE EXAMINER: Okay.
BY MR. BLEICHMAR:
Q. Does this also refresh your
recollection as to whether you also saw
exhibit 24, which is the prior version, dated
June 2006?
A. I believe I did.
Q. Did you see exhibit 24 as part of
your responsibilities while at SIS?
A. Yes.
Q. Do you believe -- is exhibit 24 -do you have any reason to believe that exhibit 24
is not an authentic copy of the document?
A. No.
Q. With respect to exhibit 25, did you
review exhibit 25 as part of your responsibilities
at SIS?
A. Yes.
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that you did not -- that exhibit 25 is not an
authentic copy of the document?
A. No.
Q. Let me direct you to -- on
exhibit 24 -- I want to compare both. On
exhibit 24, page 4179, do you see three-quarters
down the page it says "Risk monitoring steps"?
It's Bates stamped 4179.
A. 4179, yes.
Q. And three -- almost at the bottom of
the page, it says "Risk monitoring steps"?
A. Oh, right, yep.
Q. And do you see there's two points.
Point number 2 says:
"Independently confirm Madoff trading
activity with an options counterparty."
A. Yes.
Q. Strike that. I got myself confused.
Let me -- I -- I meant to direct you to
page 181 on exhibit 24, in the section called
"Regulation". Do you see point number 3 in that
section, where it says:
"Regulation cannot guarantee there will
not be a case of fraud."
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A. Yes.
MR. DRAKE: I don't see that, sorry.
Where are you?
MR. BLEICHMAR: Bates stamp 181.
MR. DRAKE: 181.
MR. BLEICHMAR: "Regulation" section,
point number 3.
MR. DRAKE: In the first paragraph?
MR. BLEICHMAR: Correct, which says:
not be a case of fraud."
Do you see that?
MR. DRAKE: Thank you.
THE WITNESS: Yes.
BY MR. BLEICHMAR:
Q. Let me now ask you to look at the
July 2006 report, exhibit number 25, page 538.
A. Yep.
Q. Do you see the section entitled
"Regulation"?
A. Yep.
Q. Do you see point number 3, it says:
not be improprieties."
A. Yep.
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Q. Do you see that between the report

on June -- on June 2006 and July 26 [sic] the word
"fraud" was deleted?
A. Well, it wasn't deleted, it was
replaced -Q. It was -- okay.
A. -- with a much broader heading.
Q. Did you instruct Jonathan Clark to
replace the word "fraud" with a more broader
heading?
A. I don't recall, but I think I did.
Q. Let me refer you to the subsequent
paragraph, labeled "View".
MR. DRAKE: In 24 or in 25?
BY MR. BLEICHMAR:
Q. Let's start with 24, Bates stamped
181, the report labeled -- dated June 2006.
A. Sorry, 181, yes.
Q. 181.
A. Yes.
Q. Do you see "View"? It says:
"Madoff Securities suffering or
committing a case of fraud is possible but
remote."
A. Yes.
Q. Let's turn to exhibit 25, page -dated June -- July 2006.

A. Sorry.
Q. Bates stamped 538.
A. 538, okay.
Q. Do you see the same sentence, it
says "View":
"Madoff Securities suffering or
committing an irregularity is possible but
remote."
A. Yes.
Q. Did you instruct Mr. Clark to change
the word "fraud"?
A. I don't recall, but it's possible.
Q. Let's move on to risk monitoring
steps on exhibit 24, dated June 2006, which -- the
same page, 181.
A. Sorry, yep.
Q. Do you see the first sentence in
this paragraph entitled "Risk monitoring steps"
says:
"Continue to cultivate our relationship
with Bernie Madoff and others in his organization
to allow us to assess any potential change in
motivation that would lead to fraud."
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A. Yep.
Q. Compare that to the July 2006
report, exhibit 25. Also in the section under
"Regulation" and the paragraph headed
"Risk monitoring steps", do you see that that
sentence says:
"Continue to cultivate our relationship
with Bernie Madoff and others in his organization
to allow us to assess any potential change in
motivation that would lead to improprieties."
A. Yep.
Q. Did you instruct Jonathan Clark to
change the word "fraud" for "improprieties"?
A. I'm not sure. I think so. I think
I did. I'm not sure.
I think one thing I just will say now is
that "improprieties" includes fraud, so it's a
much broader heading. So it wouldn't just be
fraud, it would be areas of other potential
irregularity, such as front-running, for example.
So I think it's a much bigger heading and
included not just the case of fraud, but fraud and
other areas of irregular activity.
Q. Let me turn to the final report, the
July 2006 report, in the same "Regulations"
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section on the page Bates stamped 538. The

second-to-last full paragraph that starts with
"These requirements"?
A. Sorry, the page again, please?
Q. 538.
A. Yep.
Q. Do you see that paragraph that
starts with "These requirements" at the bottom of
the page?
A. Yes.
Q. I'm going to focus on the last
sentence, which says:
"Although these audit reports are not
available to us, we have been told by
Bernie Madoff and his auditor that both the SEC
and NASD performed audits on the firm in 2005,
without any actions or qualified opinions."
Do you see that?
A. Yes.
Q. Did you confirm with the SEC that
this was the case?
A. I don't know.
Q. Did you specifically confirm -A. I didn't, no.
Q. -- with the SEC? Did you instruct
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Jonathan Clark to confirm with the SEC?

A. I don't recall.
Q. Let me move on to page 6 of the
July 2006 final report, exhibit number 25. It's
Bates stamped 539.
I'm going to go to the last paragraph of
the first box, which says "In summary"?
A. Yes.
Q. The second sentence says:
"The system is thorough but
also seems ..."
Strike that. Let me start from the
beginning.
MR. DRAKE: Sorry, where are you?
MR. BLEICHMAR: I'm on the last
paragraph of the first box that starts with, "In
summary". Do you see that?
BY MR. BLEICHMAR:
Q. "In summary, oversight of
broker-dealers is detailed and multi-layered but
works through a self-regulating system. The
system is thorough but also seems to depend more
on the penalizing of infractions than on their
prevention."
A. Yes.

A. No.
Q. Did you tell -A. I mean, the purpose of the SEC and
the NASD is to prevent -- is to prevent
infractions, not to penalise them after they've
happened.
Q. Did you tell Mr. Clark at the time
that you disagreed with that statement?
A. I don't recall.
Q. Did you ask Mr. Clark at the time to
delete that statement from the report?
A. I don't know.
Q. Did you discuss that statement with
Mr. Clark at the time?
A. I don't remember.
Q. Moving on to the next box, titled
"Financial reporting", do you see the first
paragraph, titled "Financial reporting
observations", and point number 1 says:
"The external auditor cannot be
considered realistically independent."
A. Yes.
Q. What was your understanding of who
the external auditor was?
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A. The firm Friehling & Horowitz, who

we've already discussed.
Q. Did you tell Mr. Clark that you
A. No.
statement?
A. No.
A. I do agree with that statement.
Q. Moving on to the next page,
page number 7, Bates stamp 540, do you see at the
end of the top box it says "Optimal SUS Audit",
in -- in -- in bold?
A. Sorry, on which page is this?
Q. Page number 7 -A. Yep, got it.
Q. -- Bates stamp 540. Do you see the
paragraph under "Optimal SUS Audit" in bold?
A. Yes.
Q. I'm going to focus on the third full
sentence, which starts with "This means"?
A. Yes.
Q. It says:
"This means ..."
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Strike that. Let me start a little earlier.

MR. DRAKE: Start at the beginning,
perhaps.
MR. BLEICHMAR: Sure.
BY MR. BLEICHMAR:
Q. "We verified in 2004 in
conversations with Mark Hourigan and Ken Owens of
PwC Dublin that PwC's audit for Optimal SUS relies
entirely on Madoff produced documentation.
PwC compares Madoff's monthly ... statement with
the administrator's (HSBC) statement. This means
that nothing is really independently verified as
both are sourced from the same place."
Do you see that?
A. Yes.
Q. Did you tell Mr. Clark that you
A. No.
statement?
A. No.
A. I agree with that statement.
THE EXAMINER: Can we put all of these
three away?
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MR. BLEICHMAR: Yes. Actually -- thank

you, Mr. Dyer.
THE EXAMINER: Just before you do ...
MR. BLEICHMAR: Not that we could not
have come back to it again, but ....
BY MR. BLEICHMAR:
Q. Let's just look at exhibit 26.
This is the email from Jonathan Clark to you dated
July 19, 2006; correct?
A. Yes. Yes.
Q. And it is -- the subject is
"SUS report intro"; right?
A. Yes.
Q. And in this email, Mr. Clark is
asking you whether the opening paragraph, that
presumably is below, "works"; right?
A. Yes.
Q. What did you understand that to
mean?
A. I think I'd asked him to add some
additional introduction to the report, so that it
was clear to readers of the report what the
purpose of the report was and what stage we were
in the ongoing process of due diligence, as a
firm, collectively.
Q. Thank you. You can put that aside.

through 939.
MR. DRAKE: Dated?
MR. BLEICHMAR: Dated July 7th, 2006.
BY MR. BLEICHMAR:
Q. Do you see, Mr. Burnaby-Atkins, that
this is an email from you to Manuel Echeverria,
copying Jonathan Clark and Esteban Estevez, dated
July 7th, 2006?
A. Yes, I do.
A. Yes, I did.
your general responsibilities while employed at
SIS?
A. Yes.
Q. Did -- do you have any reason to
believe that this email is not an authentic copy?
A. No.
Q. Who was Mr. Esteban Estevez?
A. He was -- well, he's now the
chief executive of Optimal. He was, at the time,
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I think, in New York responsible for managing the

relationship with the -- internally with the
bank's private bank.
Q. Did he report to you on a managerial
basis because he was in New York?
A. No.
Q. Did you say "no"?
A. No.
Q. Why do you say that?
A. I mean -- well, he didn't.
He was -- he'd been in the bank much longer than
I had and was equally as senior as I was and he
had his own direct report line up to
Mr. Echeverria, and he was in the business
development team and not part of the research
team.
Q. Understood. Let me refer you to the
third paragraph. Do you see where it says:
"Regarding Madoff, Jonathan has written
an excellent ... report already which he will
finalize next week ..."
Do you see that?
A. Yes.
MR. DRAKE: Well -THE EXAMINER: "Draft report".
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MR. DRAKE: Sorry, if you are going to

read it, you have to get it right.
MR. BLEICHMAR: Yes, I apologize.
THE EXAMINER: It was fully accidental,
I'm sure.
MR. BLEICHMAR: Thank you. Thank you
for the correction.
BY MR. BLEICHMAR:
Q. "Regarding Madoff, Jonathan has
written an excellent draft report already which he
will finalize next week ..."
Do you see that?
A. Yes.
Q. Did you believe at the time that the
draft report was excellent?
A. Yes.
to 523.
BY MR. BLEICHMAR:
Q. Do you see that it's -- at the top,
it says, "Confidential - for Manuel Echeverria
eyes only"?
A. Yes.
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A. Yes.
Q. Did you prepare this document?
A. Yes.
Q. Did you prepare this document while
employed at SIS?
A. Yes.
Q. And did you prepare it as part of
SIS?
A. Yes.
that it -- it is not an authentic copy?
A. No.
MR. DRAKE: Do you have another copy of
that?
through 618.
MR. BLEICHMAR: It's dated
September 19th, 2006.
BY MR. BLEICHMAR:
Q. And I will represent to you,
Mr. Burnaby-Atkins, that the portions highlighted

on the second page were not part of the original
document.
A. Sorry?
Q. The portions highlighted on the
second page -A. Were not?
Q. Were not part -- the highlight
itself -THE EXAMINER: The text was in there,
but the highlighting came later.
THE WITNESS: Oh, right, okay. I see
what you mean. Okay, yep.
MR. DRAKE: What number are we on?
THE WITNESS: So we're on 29.
BY MR. BLEICHMAR:
reflects an email from you to Mr. Echeverria dated
September 19, 2006?
A. Yes.
A. Yes.
your responsibilities at -- at SIS?
A. Yes.
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that this is not an authentic copy of this
document?
A. No.
Q. Let me refer you to the second page,
the fourth paragraph from the -- the fifth
paragraph from the top that starts with
"Historically"?
A. Yep.
Q. Do you see it says -- the first
sentence says:
"Historically IPB hasn't cared much about
Op Due Dill?
A. Yep.
Q. What was IPB?
A. That was the private bank.
Q. And do you agree with that
statement, that the private bank did not care much
about op due dil?
A. I agree that they may not have cared
about it, but that's very different from whether
we cared about it.
Q. Understood. But this sentence says
that, historically, IPB hasn't cared about -much about op due dil; right?
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A. Yes.
Q. And what is op due dil?
A. Operational due diligence, so
non-investment risk analysis.
exhibit 30 a document bearing Bates stamps
3146870.
MR. DRAKE: What date?
MR. BLEICHMAR: October 18th, 2006.
BY MR. BLEICHMAR:
Q. Do you see that there's an email
from Tasneem Jeevanjee to you, copying
Manuel Echeverria?
A. Yep.
Q. Did you receive this email?
A. Yes.
A. Yes.
that this is not an authentic copy of the email?
A. No.
Q. Who was Tasneem Jeevanjee?
A. She was the chief operating officer
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in Geneva, for Optimal. She was the chief

operating officer for Optimal, based in Geneva.
Q. And what was this email about?
A. It referred to the process by which
Jonathan analyzed and confirmed that Madoff was
in -- in alignment with the trading directive.
Q. Is this what you were referring to
earlier as Jonathan Clark's responsibilities to
include monitoring SUS?
A. Yes.
MR. BLEICHMAR: Let me mark as exhibit
number 31 a document bearing Bates stamps 412802.
It's dated November 8, 2006.
MR. BLEICHMAR: And I'm going to mark as
exhibit 32 a document that has no Bates stamp but
was produced to us by the defendants in electronic
format and appears -- it was an Excel spreadsheet
that is entitled "Optimal Strategic US Equity
Fund".
BY MR. BLEICHMAR:
Q. Let me first refer to exhibit 31.
A. Is this an email that Mr. Christophe
Encarnacao sent to you, among other recipients?
A. Yes.
Q. And it's dated November 8, 2006;
right?
A. Yes.
Q. And did you receive this email as
part of your duties and responsibilities while
employed at SIS?
A. Yes.
Q. And is this an authentic copy of
this email?
A. Sorry, is that a?
Q. An authentic copy of this email.
A. I believe so. I mean, there's
nothing -Q. Who was -A. Nothing there. It's just a -- a
heading.
Q. And do you see there's a series of
attachments there?
A. Yes, it refers to a series of
attachments.
Q. And do you see that some of the
attachments have extensions ".xls"?
A. Yes.
Q. And is that generally the extension
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for an Excel spreadsheet?

A. Yes.
Q. Is that something that you are
familiar with, an Excel spreadsheet?
A. Very much so, yes.
Q. Who was Mr. Christophe Encarnacao?
A. "Encarnacao".
Q. "Encarnacao".
A. He was responsible for -- he was
a -- he was back office administration and
operations analyst in Geneva.
Q. But you were in New York; correct?
A. Yes.
MR. DANON: I just put in here, for the
record, there is no Bates number on this document,
and everything that has been produced has Bates
numbers.
THE EXAMINER: Well, Mr. Bleichmar just
dealt with that. He said -- he said there's no
Bates stamp but it was produced in electronic
format.
MR. DANON: Native format? And what is
the -- what is the linked Bates stamp number.
That is the way we have operated in this case. We
have operated with a linked Bates stamp.
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MR. BLEICHMAR: Let's go off the record

to sort it out.
THE VIDEO OPERATOR: Going off the
record at 12.04 p.m.
(12:04 p.m.)
(Break taken.)
(12:13 p.m.)
THE VIDEO OPERATOR: Going back on the
record at 12.13 p.m..
THE EXAMINER: Are you done with 31 and
32.
MR. BLEICHMAR: Yes, for now.
I'm going to mark as exhibit number 33 a
MR. BLEICHMAR: March 6, 2007.
BY MR. BLEICHMAR:
Q. Do you see, Mr. -Mr. Burnaby-Atkins, that this is a document that
appears to be an email from you to Mr. Echeverria
dated March 6, 2007?
A. Yes.
A. Yes.
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your general responsibilities at SIS?
A. Yes.
Q. Do you have any reason to doubt the
authenticity of this document?
A. No.
Q. And do you see that the subject
matter is "Strategic US Equity Fund"?
A. Yes.
Q. Do you see that the first sentence
says:
"Perhaps I am gun shy post Amaranth ..."
A. Yes.
A. Well, just to be clear on this
thing, this doesn't -- by -- the -- the email has
changed from dealing with SUS at this point. It's
an old heading that refers to a different thing,
and it's relating to an investment called
Stark Shepherd. So I don't know whether that
relates to this at all.
MR. DRAKE: It doesn't.
BY MR. BLEICHMAR:
Q. That was going to be my question.
A. Yeah, it doesn't.
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Q. Thank you. Let me refer you to the

subsequent email from Mr. Echeverria to you, dated
March 6, 2007, at 4.45. It's on the same page.
A. Oh, sorry, okay.
THE EXAMINER: Well, when you say
"subsequent" -MR. DRAKE: Subsequent? Previous, you
mean?
THE WITNESS: Previous.
THE EXAMINER: -- it's earlier in the
chain.
THE WITNESS: Yeah, previous.
BY MR. BLEICHMAR:
Q. Let me rephrase that. Let me refer
you to the email prior, dated -- by Mr. Echeverria
to you, dated March 6, 2007, at 4.45?
A. Yes.
A. Yes.
Q. Did you receive that email as part
of your responsibilities at SIS?
A. Yes.
dispute that this is an authentic copy of that
email?
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A. No.
Q. And did that email include within it
the string of emails before it?
A. Yes.
Q. And is this email, the one at 4.45,
relating to Strategic US Equity Fund?
A. No.
Q. Are there any emails in this
document that relate to the Strategic US Equity
Fund?
A. Yes.
Q. Which ones?
A. I believe the one -- the ones that
start with the 5th of March 2007 at 15:36, that
relates to SUS, and the ones that pre -- predate
it, prior to that.
Q. Let's focus on those emails, the one
of March 5, 2007 at 15:36 -A. Okay.
Q. -- and the prior emails.
A. Yes.
Q. Did you send and receive -well, did you send that email?
A. Yes.
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A. Yes.
Q. Any reason to dispute that that is
an authentic copy of that email?
A. No.
Q. And you received the -- the -- the
prior string of emails; correct?
A. Yes.
Q. And the prior string of emails has
to do with Strategic US Equity Fund; correct?
A. Yes.
Q. And you -- do you see that some of
the prior emails are from an author called
Ken Owens?
A. Mmm-hmm, yes.
Q. Do you know who that is?
A. I didn't -- I didn't have direct
contact with him. I know that he was a PwC
person.
Q. Did you have an understanding at the
time of who Mr. Owens was?
A. Not his explicit responsibility,
other than that he was a -- a PwC employee.
Q. My question was a little broader.
My question was, did you have an understanding at
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the time of who Mr. Owens was?

A. No, I don't -- I don't know what -I don't know what his exact role was.
Q. You can put that aside.
through 9359. It's dated March 28, 2007.
THE EXAMINER: These are one exhibit or
two?
MR. BLEICHMAR: One exhibit.
BY MR. BLEICHMAR:
Q. Do you see that the page Bates
stamped 266 includes an email at the bottom from
Amelie Fontvieille that includes you as a
recipient?
A. Yes.
Q. And that email is dated March 28,
2007 at 11.59 a.m.; Correct?
A. Yes.
Q. And did you receive that email as
part of your general responsibilities at SIS?
A. Yes.
believe that that email is not authentic?
A. No.
Q. Do you see this -- the document
annexed to the email is -- appears to be a
presentation called "Optimal Investment Services"?
A. Called?
MR. DRAKE: Turn the page.
THE WITNESS: Oh, right, sorry. Yep.
BY MR. BLEICHMAR:
Q. Do you recognize that document?
A. Yes.
Q. What is that document?
A. It's a -- it's a description of
Optimal Investment Services and it's -- and how it
operated.
Q. Is this something that you prepared?
A. No, it's not.
Q. And is this something that you
reviewed at the time while employed at SIS?
A. It looks like a Geneva-originated
document, so they would have had sign-off on it.
Q. And why do you say that?
A. Because there were some formal
documents that were approved for release to
clients, and those emanated from Geneva, having
been approved by Geneva compliance.
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Q. And this document that begins at

268, is that a document that it's your
understanding was approved for release to clients?
A. It looks like it. I believe so.
Q. Or let me narrow that question:
is this a document that you understand to be -the purpose of the document to be to present to
clients?
A. Yes.
Q. Did you have any role in preparing
this document?
A. Yeah, I think I -- I reviewed parts
of it, certainly.
Q. And did you -- when you say
"reviewed", is that different than "prepared"?
A. These documents tended to evolve
over time, so there is no sort of formal, "This is
it". It would change and something would be added
and new people would come in and, "Could you take
another look, update it?"
So, yes, I would have been involved in
it, but parts of what I prepared might have been
altered by other people, parts of what other
people prepared might have been altered as a
result of my comments.
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So it was a collection of -- of an awful

lot of people's work, not just mine.
Q. And which -- and which parts would
you have been a part of -- or involved in
preparing?
A. Specifically, from recollection, the
parts that related to the investment process, and
specifically the investment process as it related
to the arbitrage and global trading funds.
Q. So you see on page 12, Bates stamped
280, where it says "Optimal Investment Process" -A. Yeah.
Q. -- in bigger letterhead than the
rest of the items?
A. Yes.
Q. Is that the section that you would
have had main responsibility for?
A. I don't know about "main
responsibility" because, don't forget, main
responsibility of the investment process belonged
to the CIO, so I would have been a contributor,
but he would have been the person who formally
approved, ultimately, the investment process.
Q. And what was the purpose of your
involvement, whether main or -- or partial, or --
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or whatever extent it was, in preparing this

section?
A. Sorry, what was the?
Q. Purpose.
A. The purpose? To clarify to
potential investors how we conducted our affairs.
Q. Let me focus you on pages 23 and 24.
Do you see page 23 is entitled "Investment risk
management" and risk -- and page 24 -A. Yes.
Q. -- is entitled "Risk management
process"? Were you part -- or did you participate
in any way in preparing these two pages?
A. I recall page 24; 23 looks like it
was something that was prepared in Geneva.
Q. With respect to page 24 -- do you
see the box that says "Internal checks
(GrupoSantander)"?
A. Yes.
Q. And do you see the box to the left
of that that says "Investment risk (Optimal)"?
A. Yes.
Q. What is the difference between the
checks or -- well, what's the difference between
"Internal Checks (GrupoSantander)" and "Investment
Risk (Optimal)"?
A. So investment risk would have been
what the Optimal employees were doing to manage
the risk of the investments directly, and then the
internal checks would have been the checks that
were carried out on what the investment team
itself was doing to verify that we were carrying
out our work properly.
Q. So internal checks had -- by
Grupo Santander had oversight of what investment
risk did?
A. Yes.
Q. And who -- did any one person
specifically have oversight on behalf of
Grupo Santander?
A. There was -- well, there were -there were more than one piece of it, so no one
person had pure responsibility.
There was a dedicated independent risk
manager who operated between Madrid and Geneva,
so that was one piece of it and one individual,
and he may have had other people who supported
him; I'm almost sure he did, but I didn't have
contact with him.
Separately, there was compliance, and
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that was active both in Geneva and in New York,

and then, thirdly, there was internal audit. So
there were multiple legs of that process.
So, in answer to your question, was there
one person, one person alone, no, there were all
of those pieces.
Q. Let me try to break that down. You
said there was a dedicated independent risk
manager who operated between Madrid and Geneva?
A. Yes.
Q. Are you referring to a person
specifically?
A. Yes.
Q. Who was that?
A. I don't remember his exact name.
I think it was Amadeo -- and I can't remember his
second name.
Q. Does the name Amadeo Reynes Pascual
refresh your recollection?
A. Yeah, I think so.
Q. And what did you understand his
position to be?
A. His position -- and, again, I never
met him, so I had no contact with him directly,
but I understood his position to be responsible
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for monitoring the risk rules that governed how we

constructed our portfolios.
Q. The next item is said to be
"Compliance"?
A. Yes.
Q. In the same box?
A. Yes, sorry.
Q. Is there a particular person
associated with that compliance function?
A. No, there were multiple people.
Q. And do you know who they were?
A. I can think -- Jim Bathon was one of
them in New York. I don't know who they were in
London. I don't know who they were in Geneva.
I don't know who they were in other parts of the
bank.
And Jim also had -- he wasn't there for
the entire time, there were other people involved
as well, so it was -- it was a team of people.
THE EXAMINER: Was there a head of
compliance.
THE WITNESS: In New York?
THE EXAMINER: For the -- for the group?
THE WITNESS: For Optimal group. Well,
this -- this is bank --
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THE EXAMINER: This is under

Grupo Santander.
THE WITNESS: Yes.
THE EXAMINER: Was there a head of
compliance for Grupo Santander?
THE WITNESS: Yes, but he was -- so the
compliance teams in each of these divisions would
have reported up into Madrid, and that was -- but
we had absolutely no contact with them.
So we -- we interacted with them in
regional centers, and I only interacted with
them -- with them in New York, but above and
beyond that, it was -- you know, I -- I wouldn't
like to say who was -- who those people were.
BY MR. BLEICHMAR:
Q. And with respect to internal audit,
who were the -- the persons specifically -A. I don't know.
Q. You mentioned earlier that internal
checks, generally Grupo Santander, had oversight
of investment risk; correct?
A. They had oversight of the investment
risk rules, yes. We had oversight of investment
risk. It was our job to manage investment risk.
Q. And --
A. It was their job to make sure that

we were doing that properly.
Q. So internal checks had oversight
over your functions; correct?
A. Sorry, just explain that again?
MR. DANON: Objection to form.
THE EXAMINER: That's all right. You
can answer.
THE WITNESS: Could you just ask the
question again? I'm not sure I fully understood
it.
BY MR. BLEICHMAR:
Q. Yes, absolutely, and I'll rephrase
it.
The -- you mentioned that investment risk
is something that you and your group monitored;
correct?
A. Yes.
Q. And you made a distinction between
investment risk and investment risk rules?
A. Yes.
Q. Correct? And if I understood you
correctly, the Grupo Santander internal checks
box, if you will, monitored the rules?
A. Yes.
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Q. Not necessarily the investment risk;

is that correct?
A. Yes.
Q. Okay. As part of internal checks
and Grupo Santander's monitoring of the investment
risk rules, did you interact with them?
A. Indirectly, yes.
Q. And -- and what do you mean by
"indirectly"?
A. Well, every -- every month we had an
investment committee meeting, and every month a
full review of every single position in every
single portfolio would have to be produced, or,
actually, more accurately, any exceptions where
the rules had been breached would have to be
produced.
So that was produced on a monthly basis,
and it was part of my responsibility to be aware
of and to make sure that any exceptions were -were produced and -- and -- and caught and flagged
up so that the risk manager was aware of -- of -of what was happening and also what we were doing
about it.
Q. So, focusing again on the indirect
proportion of it, do I understand you correctly
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that the risk manager interacted with the

investment committee?
A. Yes.
Q. And you, as a part of the investment
committee, had indirect interaction with the risk
manager?
A. Yes.
Q. And when you say "the risk manager",
are you referring to Amadeo and his team?
A. Yes.
Q. Did Amadeo and his team participate
in the investment committee meetings?
A. No.
Q. Did you participate in the
investment committee meetings?
A. Yes.
Q. How do you know that Amadeo
monitored the investment risk rules through the
investment committee?
A. I don't, but I -- well, we were
a properly run organization, and -- and it was
made clear to me that he was pretty focused, but
he -- his job -- the job of reporting to him was
done from Geneva, so it was their responsibility
to report to him, but it was my responsibility to
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report to the chief investment officer in Geneva

and also legal counsel, who was very hot on making
sure this list was produced, and also there was a
dedicated analyst who prepared the list, so,
you know, I knew that process was active, I knew
it was engaged, we regularly got asked about it in
our investment committee meetings, we had all
the -- a watch list of those funds where there
were -- where alerts had gone off.
So it was abundantly clear that it was -it was fully engaged, active and -- and operating
correctly.
Q. And fully engaged, active
and operating -- "fully engaged", you are -- you
are referring to Amadeo Pascual Reynes?
A. Yes. Yes.
Q. Now, you mentioned three
individuals: the chief investment officer.
Was that Manuel Echeverria?
A. Yes.
Q. And you also mentioned legal
counsel. And was Manuel Echeverria the chief
investment officer throughout your employment at
SIS?
A. Yes, he was.
Q. And when you say legal counsel, who

was legal counsel?
A. Jaime Calvo.
Q. And was he legal counsel throughout
your employment -A. Yes, he was.
Q. -- at SIS?
A. Yes.
Q. You mentioned that legal counsel
"who was very hot on making sure this list was
produced". What did you mean by "very hot on
making sure this list was produced"?
A. I think, bear in mind, as I said,
that the -- the process -- that process of risk
management happened in Geneva, so I wasn't
actively engaged in it.
I was a -- I reported into it, so I'm
going to limit my comments a bit, because they may
be assumptions, rather than statements of fact.
Q. And I don't want you to make any
assumptions.
A. But what I was -Q. I just want your knowledge.
A. -- aware of was that the CIO was
overall responsible for ensuring that the risk
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management process within Optimal worked properly

and reported correctly up to Amadeo and his team
in Madrid and that the people involved in that
risk management process were the COO,
Tasneem Jeevanjee, who was one of those people;
Jaime Calvo was another one of those individuals,
and he would -- you know, because he was also
aware that -- both he and Tasneem were aware that
internal audit ultimately would want to go over
this ground again, so that they were keen to make
sure that it was done thoroughly and efficiently
and promptly; Cecilia Alvarez, who was the analyst
who collated it periodically, but there were
others; and Manuel, who made sure all of those
things happened at the top of the hierarchy.
Q. And was it your understanding that
Manuel reported correctly up to Amadeo?
A. Very much so.
Q. And what is the basis for your
understanding?
A. Because he was the head of the
investment management committee. He was head of
the management committee. It was his job for
chairing the investment committee meetings that
happened on a monthly basis. We would go through
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the watch list on a monthly basis.

Q. Manuel Echeverria's job?
A. Yes, and I would see the -I would -- we would discuss actively the watch
list, and we would be asked about it, we would be
asked what we were doing about any positions that
were on the watch list.
Being practical about it, we would be -we would be volunteering those positions where we
had concerns, because it was very much the -in the interests of the analysts to foresee risk,
the pitfalls, and avoid them, rather than to deal
with them after they'd happened. So we were -- it
was an iterative process and a fully engaged
process.
believe that Mr. Echeverria ever failed to report
information to Amadeo?
A. No.
that Mr. Echeverria ever concealed information
from Mr. Amadeo?
A. No.
THE EXAMINER: Did so you say no?
THE WITNESS: "No." Sorry, no, I don't
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BY MR. BLEICHMAR:
Q. You also mentioned that there was
analyst that prepared the list?
A. Yes.
Q. Who was that analyst?
A. That was Cecilia Alvarez -Q. Was she -A. -- for a period of time, but there
were others. I can't remember who they were.
Q. And by "the list", what do you mean
by "the list"?
A. The watch list. So those were funds
that had breached the risk rules.
But, bearing in mind, we're slightly
going off trail here, because these all related to
the funds of funds which had their sets of risk
rules, not to SUS.
exhibit 35 -THE EXAMINER: Just before you leave
this one, Mr. Bleichmar, I wasn't quite sure why
you linked this with the email, because the email
asked for:
"Do we have an Investment due diligence
Policies & Procedures manual and a non-investment
due diligence Policies & Procedures one."

And I didn't see this document as either
of those.
MR. BLEICHMAR: The document was
produced by defendants sequentially Bates stamped,
and the first -THE EXAMINER: Yes, I see.
MR. BLEICHMAR: -- email -THE EXAMINER: So that's an assumption
you made. Okay.
MR. BLEICHMAR: Let me mark as
exhibit 35 a document Bates stamped 514515 through
521.
MR. BLEICHMAR: It is dated -MR. DRAKE: April 17.
MR. BLEICHMAR: -- April 17, 2007.
BY MR. BLEICHMAR:
from you to Mr. Echeverria with a number of
copyees?
A. Yes.
Q. And did you send this email?
A. Yes.
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regular responsibilities -A. Yes.
Q. -- while at SIS?
A. Yes.
that this email is not authentic?
A. No.
Q. And do you see that the email
includes an attachment titled "Grima PowerPoint"?
A. Yes.
Q. And do you see the document -- or
the pages starting at 519 through 521: "What's
good. What's not. The fix"?
A. Yes.
Q. Is that the Grima PowerPoint that
you attached to the email?
A. Yes.
Q. And did you prepare the
Grima PowerPoint?
A. No, I didn't.
Q. Who did?
A. Mr. Echeverria did.
THE EXAMINER: Sorry? Who was that?
THE WITNESS: Mr. Echeverria did.
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BY MR. BLEICHMAR:
Q. Did you have any input into
preparing the Grima PowerPoint?
A. Well, hang on a sec, which one are
we talking about here? There's ...
Q. Do you see -A. Are you talking about this document
here?
Q. Correct.
A. Oh, yes, I did prepare that one.
Sorry.
Q. So you did prepare the document -A. Yes.
Q. -- that says "What's good" on top?
A. Yes. Yes.
Q. And you prepared it as part of your
regular responsibilities at SIS?
A. Yes.
Q. And you have no reason to believe
that that document's not authentic?
A. No.
Q. Let me refer you to page 520,
"What's not"?
A. Yep.
Q. Do you see the second bullet,
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that context, and some of these things may have
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like, internally just for -- for -- for people's
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personal circumstances.
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lot more time on this document, because we are

running short of -- slightly short of tape time.
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"Management issues", says:

"Micro-management by Manuel ..."
A. Mmm-hmm.
Q. Did you believe that Manuel
micro-managed?
A. What I'm going to say about this
report is it was -- it was a bit of an open forum,
and it incorporated a lot of comments from all of
the people on that list, and you'll see very much
the email says "Hugh (on behalf of the New York
team)".
So a number of these points were points
that were raised by other individuals in the team
that I was representing to Manuel.
So some of it I would have agreed with,
some of it I might not have agreed with, but
my key here was to communicate all the points
that had been raised by -- across the team to
Manuel.
Q. Understood.
A. And, you know, the other context of
this is, this is Manuel going to speak to the head
of asset management to try and negotiate a better
position for Optimal, but it was also a chance for
individual employees to try and negotiate a better
So, it really ought to be understood in
THE EXAMINER: Are you going to spend a
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MR. BLEICHMAR: Let me get started.
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We'll use five minutes. We'll use five minutes.
19
BY MR. BLEICHMAR:
MR. BLEICHMAR: How much time do we have

left?
THE VIDEO OPERATOR: Well, we can push
THE EXAMINER: It's entirely up to you,

whether you want to try to finish in time.
Q. So, if I understood you correctly,
12:41:50
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these comments reflect comments made by the
12:41:58
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New York team --
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Q. -- but not necessarily you?
12:42:03
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A. No, it was -- it was a -- I was the
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position for themselves.
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conduit for a lot of comments by a lot of

different people.
Q. The comment that one of the
management issues was micro-managed by Manuel -A. Yep.
Q. -- is that your comment?
A. I think that originally came from
James Woodyatt, so it was an echo of an earlier
comment.
THE EXAMINER: The highlighting in this,
is this, again, later or was that original?
MR. BLEICHMAR: Yes, the highlighting,
to the extent there is any, is -THE EXAMINER: Is subsequent?
MR. BLEICHMAR: -- is subsequent to the
email. The text is original.
THE WITNESS: Yes.
BY MR. BLEICHMAR:
Q. Did you believe that Manuel
micro-managed?
A. And I think Steve Seneque had also
echoed it as well, so it was -- there was an
element of that. He was -- he was -- he was
involved in detail.
Q. Manuel was involved in detail?
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A. Manuel was involved in the detail,

yes.
Q. HS -- moving forward to operational
issues, HSBC was -- do you have an understanding
as to whether HSBC was the custodian and
administrator of Optimal SUS?
A. Yes.
Q. It was?
A. Yes, yes.
Q. To clarify the record, you have an
understanding; correct?
A. Yes.
Q. And what is that understanding?
A. Yes, that it was the administrator
and custodian.
THE EXAMINER: It always helps if you
ask a non-leading question.
MR. DRAKE: Well, I was just going to
say. Yes.
BY MR. BLEICHMAR:
Q. And do you see there where it says
"HSBC sucks"?
A. Yes.
Q. Was that your comment or was that
somebody else's?
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A. That was someone else's.

Q. And do you understand what the basis
for that was?
A. I think the general consensus in the
hedge fund industry is that most -- trying to find
a good administrator was like trying to find a dog
with the least fleas. I don't think -- I think
you could have deleted and inserted any
administrator in there, but there you go.
Q. Do you see the next bullet says:
"Santander issues."
A. Yes.
Q. "- Independence of Optimal is an
illusion."
A. Yes.
Q. Whose comment was that?
A. I'm not sure.
Q. Was it your comment?
A. I'm not sure.
Q. When -- do you have an understanding
as to what it meant, "Independence of Optimal is
an illusion"?
MR. DRAKE: Did he have an understanding
at the time?
MR. BLEICHMAR: Yes.
THE WITNESS: I think so, but if you

could be a bit more specific about it, I could
answer that question a bit better.
BY MR. BLEICHMAR:
Q. My -- I can only go by what's in the
statement.
A. Okay.
Q. If you have any recollection as to
the -- your understanding of the meaning of that
statement, that's what I'm asking about.
A. Yeah, I mean, Optimal was a
wholly owned subsidiary of -- of Santander.
I mean, it was not an independent -- it was
independent in name, and that was it.
Q. Did you agree that independence of
Optimal is an illusion?
A. Yeah, I think so. I mean, we had
freedom of manoeuvre, but actual true
independence, we were not an independent entity,
we were a wholly owned subsidiary.
Q. Do you see the next bullet point
says:
"Micromanagement of Optimal by SAM ..."
A. Yes.
Q. What is your -- what was your
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understanding of that statement?

A. If you look in the -- in the
brackets behind it, it uses the word "Basic admin
details", it lists various things, and at the end
of it, "day-to-day business and admin" again.
So it was administrative -- the administrative
aspects of doing business were micro-managed by
Optimal.
In particular, I think this referred to
an incident where we tried to hire an employee
over the summer and then found it very difficult
to get that approved by -- by Madrid, by SAM.
Q. Did you agree with that statement,
that micro-management -- of micro-management of
Optimal by SAM?
A. It was specifically relating to that
incident I just mentioned, yes. But there are
other areas where we had considerable freedom, so
I agree with it in part.
MR. BLEICHMAR: We have two minutes left
on the tape. Let's -THE EXAMINER: If you're going to go
through the rest of the bullet points -MR. BLEICHMAR: Yeah.
THE EXAMINER: -- I think we'll go off
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the record.
MR. BLEICHMAR: Let's go off the record.
THE VIDEO OPERATOR: This marks the end
of tape number 2 in the deposition of
Mr. Hugh Burnaby-Atkins. Going off the record.
The time is 12.46 p.m.
(12:46 p.m.)
(Break taken.)
(1:33 p.m.)
THE VIDEO OPERATOR: Back on record.
Here marks the beginning of tape number 3 in the
deposition of Hugh Burnaby-Atkins. The time is
1.33 p.m..
BY MR. BLEICHMAR:
Q. Mr. Burnaby-Atkins, before the break
we were discussing exhibit 35; correct?
A. Yes.
Q. I want to refer you again to
that exhibit, and specifically to the page
Bates stamped 520, which was the one with the big
"What's not" on the -- on the top.
A. Mmm-hmm.
MR. DRAKE: You're not going to ask him
questions about the previous page?
MR. BLEICHMAR: Not at this point.
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I may.
BY MR. BLEICHMAR:
Q. Let's focus on the last bullet
point. Do you see where it says:
". Lack of reinvestment of profits in
Optimal."
A. Yes.
Q. Was that a -- your comment or was
that a comment of another member of the New York
team?
A. I don't know. I don't remember.
Q. Do you have a -- did you have an
understanding of what that meant at the time?
A. It could mean a number of things.
I'm not sure at this -- this distance.
Q. Do you know whose comment that was?
A. I don't know, no.
Q. Moving on to the next page, entitled
"The fix", Bates number 521, do you see the third
bullet point is labeled "Operational wish-list"?
A. Yes.
Q. Do you see the last subpoint there
states:
"- registration with local regulators."
A. Yes.
Q. Do you know what that meant? Did

you know what that meant?
A. Yes.
Q. What did that mean?
A. That meant that there was -- it -it was a comment -- that was definitely a comment
from the business development team, who felt that
if we were -- wanted to expand our presence at
some point and bring on U.S. clients, we would
need to have U.S. SEC registration as an entity
ourselves in order -- because the consultants
wouldn't want to do any business with us if we
weren't SEC registered. A very simple
black-and-white point, that one.
Q. You can put that document aside.
through 920.
MR. BLEICHMAR: One second. I believe
it's dated March 29th, 2006.
BY MR. BLEICHMAR:
reflects an email from you to Jonathan Clark
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dated March 29th, 2006?

A. Yes.
Q. Do you see that the subject is
"Madoff report"?
A. Yes.
A. Yes.
SIS?
A. Yes.
Q. Is this an authentic copy of this
email?
A. Yes.
Q. Do you see that the email includes
an attachment called "DePauw v Hennessee
Complaint.pdf"?
A. Yes.
Q. And is that attachment before you?
A. Yes.
Q. And is that the document entitled
"Complaint" and Bates stamped 894 through 920?
A. Yes.
Q. Let me direct you to the email -the -- the text of the email to Jonathan on
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page 892. The second-to-last paragraph, do you

see that it says:
"I spoke to Norman Chait since we last
talked so have a modest bit of feedback from that
direction ..."
A. Yep.
Q. What did you speak with Norman Chait
about?
A. I wanted to talk to him about his
recollections of the work that he had done during
the initial due diligence phase of setting up the
Madoff account with -- within SUS.
Q. And what did you discuss with him?
A. I don't recall exactly, other than
wanting to get his perceptions of -- of SUS and
find out what work he'd done.
Q. And what were his perceptions of
SUS?
A. I think that it was -MR. DANON: Object to the form of the
question.
MR. DRAKE: You -- you're actually
asking him what he relayed as being his
perceptions of SUS, are you?
MR. BLEICHMAR: Correct. Let me
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rephrase it.
MR. DRAKE: In that conversation.
MR. BLEICHMAR: Let me rephrase that.
BY MR. BLEICHMAR:
Q. What did Mr. Chait relay to you in
that conversation were his perceptions of SUS?
A. I can't remember. I don't think -it wasn't a long conversation, for a start, and
I can't remember where it took place, but I -- it
wasn't a formal meeting, as such, so I didn't take
notes on it, I don't think, but it was -- there -there was -- there was nothing untoward that came
out of it, that's probably the key point to make
here, and that he thought it was -- you know,
he -- he was -- he -- he -- he fully endorsed it.
He fully supported it, and he was, you know, very
positive about it.
Q. Did you have -- so you had this
conversation face to face?
A. Yes.
Q. Is this the only conversation that
you had with Mr. Chait with respect to Optimal
SUS?
A. I don't know. I didn't have a lot
of contact with him. I tried to get hold of him,
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but I didn't have a lot of contact with him.

Q. Did you meet with Mr. Chait on any
other occasion to discuss Optimal SUS?
A. Not that I recall.
Q. Did you meet with Mr. Chait for any
other reason?
A. No, and I don't think I met with him
specifically. I think I met with him at a
conference and that it was an incidental
conversation, rather than a formally set-up
meeting. And I -- I then tried to call him
afterwards, on a number of occasions, to get hold
of him to try to speak to him further on the
subject, but he didn't seem to be particularly
interested in -- in having those conversations.
Q. Do you see further in that email
where it says:
"... it might make sense for you to call
him also."
A. Yes.
Q. And you're telling Jonathan that it
may make sense for Jonathan Clark to call
Mr. Chait; correct?
A. Yes.
Q. Do you know if Mr. Clark called
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Mr. Chait?
A. I don't know. I don't know whether
he did.
Q. In your conversation with Mr. Chait,
did he relay to you that he had kept up with any
developments with SUS since the time Chait had
left SNS?
A. I'm not aware of it.
Q. Let me ask it a different way:
did Mr. Chait relay to you whether he'd kept up
with Madoff since he had left SNS?
A. No. No.
BY MR. BLEICHMAR:
Q. Let's focus on the third paragraph
of that email. Do you see where it says:
"The aim will be to highlight all
non-investment risks with the structure ..."
A. Yep.
Q. Do you see the first paragraph right
underneath that says:
"Lack of independence of the auditors
(Madoff is the only client) i.e. the commercial
set up gives him effective control of his
auditor."
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A. Yes.
Q. You wrote that statement; correct?
A. Yes.
Q. Did you agree with that statement?
A. Yes.
Q. The next statement says:
"Inability to see client trades at DTC
(how much transparency can we get)"
A. Yes.
Q. Do you see that?
A. Yes.
Q. You wrote that statement; is that
right?
A. Yes.
Q. And do you -- did you agree with
that statement at the time?
A. Yes.
Q. Did you ever -- were -- strike that.
Were you ever able, while you were
employed at SIS, to "see the client trades at
DTC"?
A. No. We asked for them, but it was
confidential. Client confidentiality prevented
them from disclosing them to us.
Q. The next bullet says:
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"Lack of confirmation of actual fund

levels in bank accounts ..."
Do you see that?
A. Yes.
Q. Were you ever able to confirm
the actual levels -- the actual fund levels in
bank accounts?
A. Not fully. We -- although we were
told by the auditors that they were there, but did
we see that with our own eyes? No. Again, we -we tried, but we were unable to confirm.
Q. And by "the auditors", are you -you're referring to Madoff's auditors; is that
right?
A. Madoff's auditors, yes.
Q. In the first bullet there, "Lack of
independence of the auditors", are you referring
to the auditors of Madoff also?
A. Yes.
Q. Let's go back to exhibits 31 and 32.
Do you have those in front of you right now,
Mr. Burnaby-Atkins?
A. Yes.
Q. Do you see that exhibit 31 reflects
an email from Mr. Encarnacao to -- to you?
A. Yes.
Q. And it's dated Wednesday,
November 8, 2006?
A. Yes.
Q. Exhibit 32 was produced by
defendants in this action with a Bates stamp that
is consecutive to that email, being the 412803.
Did you receive the email which is now
exhibit 31?
A. Yes.
A. Yes.
Q. And did you -- do you have any
reason to believe this is not an accurate copy of
that email?
A. No.
Q. Did you also receive as an
attachment to that email what has now been labeled
exhibit 32?
A. I -- I don't know. I -- I have no
way of knowing that that is one of those.
THE EXAMINER: It looks like a -- it's a
document giving a valuation date of 31st of
October 2006, overall value.
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THE WITNESS: Yes.

THE EXAMINER: Does that accord with any
of these titles with any of these -THE WITNESS: I mean, it -- it's
perfectly possible, but, I mean -THE EXAMINER: It's difficult to see,
isn't it?
THE WITNESS: You know, this doesn't
have a name. I mean, there's no -- I have no
reason to believe it wasn't, but I can't say with
certainty that it -- that is what the -THE EXAMINER: No, no, I see that.
BY MR. BLEICHMAR:
Q. Fair enough.
A. That's -- which was the question.
Q. Just focusing -- focusing strictly
on exhibit 32, is this the type of document that
you will -- would have seen while you were
employed at SIS in connection with Optimal SUS?
A. Yes.
Q. And why do you say that?
A. Although it looks to be a
back-office document, rather than a -- an
investment-generated document, so it would be
something that the back office would normally use
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rather than the investment team, so it was not

something, I think, that was routinely sent to us.
Q. Is that consistent with the fact
that Mr. Encarnacao was in the back office?
A. Yes, generally.
Q. Do you know why Mr. Encarnacao sent
you that email on November 8, 2006, with those
attachments?
A. No.
Q. Let me direct you to exhibit 32.
Do you see that it is labeled "Optimal Strategic
US Equity"?
A. Yes.
Q. And it states that it has a current
valuation date of 31 October 2006; right?
A. Yes.
Q. Do you see that across the top there
is a class A, class B, class C?
A. Yes.
Q. Do you -- do you know, generally,
what that refers to?
A. Yes. There were different share
classes within the SUS fund.
Q. And what was the difference in the
different share classes in SUS?
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A. Currencies, as well as fee

structures, typically.
Q. So, for example -A. And minimum investment. So one
might be an institutional class, one might be a
retail -- retail class, different minimum
investment, perhaps, that kind of thing.
Q. So if we just focus on the class A
U.S. dollar column, and we go down almost -- a
little bit past half of that box, where it says
"Management fee rate per class"; do you see that?
A. Yes.
Q. Is that what you're referring to as
the difference between the classes of shares?
A. Yeah, exactly, so you've got three
dollar share classes, each with different fee
rates. Then you've got two euro classes with
different fee rates, by the looks of things.
Q. And so the class A shares had a
management fee of 2.15 percent; correct?
A. Yep.
Q. And is it 2.15 percent per year?
A. Yes.
Q. So, just for the purposes of
an example, if an investor invested $100 in
Optimal SUS in the class A shares, that meant that

he paid $2.15 a year in management fees?
A. Yes.
Q. If the investment appreciated from
100 to 1,000 -MR. DRAKE: Before you complete the
question, which -- which of the subject matters in
schedule A do you say this question relates to?
MR. BLEICHMAR: I left my schedule A.
Could you lend me a copy?
MR. DRAKE: Here, have a look at mine.
That's a bad sign already.
MR. BLEICHMAR: It generally refers to
the motive on conducting due diligence, to the
extent the remuneration of Optimal had to do with
the amount of -- of assets under management.
It also has to do with the supervision
and control of OIS by Banco Santander, to the
extent that the prior document said that
Banco Santander took a lot of the profits from
Optimal.
MR. DRAKE: But, surely, the management
fee charged by Optimal in respect of the fund
bears on neither of those things.
THE EXAMINER: Well, what about 5? It
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seems to me 5 is broad enough to encompass.

MR. DRAKE: It is neither its duty nor
its responsibility.
MR. BLEICHMAR: Well, it certainly
includes the duties -- the duties certainly arise
in part from the remuneration that Optimal is
receiving, or OIS is receiving.
MR. DRAKE: For my -- for my part -- for
my part, I don't see that it has anything to do
with any of the subject matters, but it's a matter
for the examiner to decide.
THE EXAMINER: I think it's a
counterpart of the duties and responsibilities
in 5.
MR. BLEICHMAR: And I'm not going to go
much further, other than establishing the basic
knowledge of the structure of the fee.
THE EXAMINER: I think you are entitled
to establish that, although your $100 into 1,000
was a rather alarming example.
MR. BLEICHMAR: I'll rephrase that
example. I didn't mean to do that.
BY MR. BLEICHMAR:
Q. If the investment appreciated from
the original -- the original investment was $100?
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A. Yes.
Q. You mentioned that the management
fee on class A shares at 2.15 percent would be
$2.15; correct?
A. Yes.
Q. If the investment the next year
appreciated, would the 2.15 percent management fee
be calculated over the new value of the
investment?
A. Hypothetically, yes.
Q. Why do you say "hypothetically"?
A. Well, because it is a hypothetical
question.
THE EXAMINER: Well, it would be
calculated on whatever was the -THE WITNESS: It would be calculated
whatever the net asset value of the fund was
calculated to be at the time.
So here you've got the net asset value of
these funds. That fee was applied, or the -- a
relevant fee was applied to the relevant net asset
value of these funds.
BY MR. BLEICHMAR:
Q. Thank you. And you see the -- the
line item below "management fee rate per class" is
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"management fee accrued"?

A. Which line item are you on here?
Q. The 2.15 percent corresponds to
"management fee rate" -A. Oh, right. I see what you mean.
Yes.
Q. So the following line item is
"management fee accrued"; right?
A. Yes.
Q. And for the class A shares, it's
approximately $2.7 million; correct?
A. Yes.
Q. Can you tell me what that means to
you?
A. I mean, it's an accounting feature,
so I'll have to give you my understanding, if
that's okay, but it means that, as the management
fee was booked, it would accrue and you would,
therefore, net off the accrued fee from the
notional amount of the fund to give you the final
value after -- net of fees that was attributable
to the investor.
Q. Understood. And if you go across
the "management fee accrued", those numbers
reflect the management fee accrued for the various
class shares of the fund; correct?

A. Yes.
Q. And so the total amount of
management fees accrued for that period was
$3.9 million; is that right?
A. Well, for which period?
Q. For the period of this document.
See at the top left-hand corner:
"Current valuation date: 31 October
2006.
"Previous valuation date: 29 September
2006".
MR. DANON: Objection to the form of the
question.
THE WITNESS: I'd have to get my
calculator out to confirm that.
BY MR. BLEICHMAR:
Q. Let me ask it a different way.
MR. DRAKE: Well, I -- I renew my -- I
renew my objection.
THE EXAMINER: I think we're going into
detail that doesn't have really anything to do
with 1 to 5.
MR. BLEICHMAR: Let me just ask two more
questions generally about his recollection of the
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revenues of Optimal with respect to SUS.

MR. DRAKE: Well, except that they
don't -- and I maintain my objection, they don't
fall within any of the subjects. It's got nothing
to do with the due diligence, it's got nothing to
do with the supervision by Banco Santander -THE EXAMINER: You don't need to go
through 1 to 5. It's all right. I have been
pretty lenient with you. The revenues of OIS?
MR. BLEICHMAR: From Optimal SUS. Just
that.
THE EXAMINER: What does it relate to?
MR. BLEICHMAR: It relates to, again,
the motive to conduct due diligence and to conduct
adequate due diligence of Madoff. It goes to the
duties and -- it creates duties and
responsibilities of OIS with respect to SUS.
This is purely -THE EXAMINER: You've got out -- you've
got out of it that as at the end of October in one
particular year they'd made a total of
$3.9 million. Isn't that enough for your
purposes?
MR. BLEICHMAR: I just want to ask
whether that comports with his general
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recollection of -- of the fees.

THE EXAMINER: Then we will move on?
MR. BLEICHMAR: Then we will move on.
BY MR. BLEICHMAR:
Q. And let me, for the record, make
that clear, if I could rephrase my question?
A. Yes.
Q. Does a fee of approximately
$4 million payable by SUS to Optimal generally
comport to your recollection of the fees at the
time?
MR. DANON: Object to the form.
THE WITNESS: Do you know -BY MR. BLEICHMAR:
Q. All right.
A. -- I was not involved in fee
calculations or the -- or the conducting of the
accounts.
Q. Fair enough.
A. This was all done by the back office
in Geneva. They may have sent it, to be honest,
but I think the reasons why we -- we would have
looked at it would have been to see what the
performance was over that -- that month, but our
job was not to check the fee calculations. So
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I think, you know, that was -Q. Fair enough.

A. -- performed elsewhere in the
organization.
through 919.
BY MR. BLEICHMAR:
Q. And do you see, Mr. Burnaby-Atkins,
that -MR. DRAKE: Sorry, just what's its date?
MR. BLEICHMAR: Oh, it's July 6th, 2007.
BY MR. BLEICHMAR:
Q. This document reflects an email from
Sebastien Poiret to Jason Mercurio, and copying
you, on July 6, 2007?
A. Yes.
Q. And did you receive this email,
these two emails, dated the same -- the same date?
A. Yes.
Q. And did you receive these emails
in -- as part of your general responsibilities
while working at SIS?
A. Yes.
Q. And is this an authentic copy of
these two emails?
A. Yes.
MR. DRAKE: That's it?
MR. BLEICHMAR: That's it.
document bearing 488895 through 896.
MR. DRAKE: Dated?
MR. BLEICHMAR: It's dated July 10th,
2007.
BY MR. BLEICHMAR:
this is -- there is an email from -- the second
email from the top of the page is an email from
you to Oleg Langbort and Jonathan Clark, dated
July 10th, 2007 at 4.18 p.m.?
A. Yes.
A. Yes.
A. Yes.
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Q. Is this a authentic copy of this

email?
A. Yes.
Q. Do you see where you say:
"Did you see this - any use for looking
at Madoff's activities?"
A. Yes.
A. Exactly what it says: it was a
question. I'd seen -- I'd come across this.
I don't think I'd obviously looked at it in great
detail, but, given that we had made previous
inquiries of the DTCC, I wondered whether it might
be worth taking a fresh look at it and seeing if
it was in any way useful for improving the
coverage that we had of the SUS fund.
Q. Do you have any understanding as to
whether this was useful for improving the coverage
that you had of the SUS fund?
A. I don't think it was.
Q. And why do you say that you don't
think it was?
A. I don't recall this having led
anywhere.
Q. In other words, you never
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confirmed -- strike that.

Optimal never confirmed with DTC
independently the trading of Madoff; correct?
A. Incorrect.
Q. Okay. Why is that?
A. Optimal did phone up DTC and confirm
the trading of Madoff and got a clear answer from
them that, yes, he was trading with them.
Q. Did -A. So this follows up considerably
after that took place.
Q. Did that confirmation include
confirmation that -- by the DTC that Madoff traded
on behalf of SUS?
A. It didn't go to that level of
detail. They weren't prepared to give us that
information. We asked for it, but they weren't
prepared to give it to us. We specifically asked
for it.
THE EXAMINER: "DTC" and "DTCC" are the
same?
THE WITNESS: Interchangeable, I think:
Depository Trust and Clearing Corporation.
BY MR. BLEICHMAR:
Q. What do you mean by the fact that
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they weren't prepared "to give it to us"?

A. In that the client of the DTCC was
Madoff, and, therefore, it was privileged
information what trading activity any client would
have had with DTCC. So I don't think it was
unique to Madoff; it was something that they -you know, if you'd phoned them up and asked about
any of the people who traded with them, you know,
your broker or anyone else's broker, you would be
unhappy if your broker told a third party what
they were doing.
So it wasn't unreasonable. It was
frustrating for us not to be able to get that
information, but it wasn't unreasonable.
Q. Optimal never independently verified
that Madoff conducted trades on behalf of SUS;
correct?
A. Optimal was unable to. Optimal
tried to. But, as I said before, they would tell
us that Madoff was trading with them.
So we knew that there was trading
activity, which is very important. Some people
have suggested that that was never confirmed, and
that's wrong; it was confirmed. We confirmed it.
But what we couldn't confirm was the level of
detail and for whose account he was trading.

Q. And precisely on that level of
detail, you were never able to confirm -MR. DRAKE: Please don't cross-examine.
MR. BLEICHMAR: I haven't finished my
question.
MR. DRAKE: It's not off to a good
start.
BY MR. BLEICHMAR:
Q. Why couldn't you confirm the level
of detail that allowed you to confirm that Madoff
traded on behalf of Optimal SUS?
A. I thought I'd explained that a
second ago, but I'll try again.
It was -- it was privileged information,
in that the DTCC's client was Madoff and,
therefore, the DTCC had a duty of care to its
client not to divulge confidential client
information, and this represented confidential
client information.
The DTCC told us we were at liberty to
ask Mr. Madoff if he wished to divulge that
information, or so I understand, but the DTCC was
not allowed, under its terms, to tell us that
information.
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Q. Did you ask Mr. Madoff?

A. Yes, and we asked his auditors
whether the accounts were segregated, and our
understanding was that they were.
Q. Did you ask anybody else, other than
Madoff and his auditors?
A. I mean, I'm not sure who we would
have asked. No, I don't think so, but I don't
think there's anyone else who could possibly have
known that information. So I don't think so.
Q. Did you ask Fairfield?
A. Whether Madoff was trading for our
account?
Q. Whether they had confirmed with the
DTCC that Madoff traded on behalf of Fairfield?
A. On a segregated basis?
Q. On a segregated basis.
A. Of Fairfield?
Q. Right.
A. I don't recall that specifically.
through 961.
BY MR. BLEICHMAR:
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Q. And I'm not going to ask you about

the top email.
A. Sorry?
Q. I'm not going to ask you about the
top email in the document.
A. Okay.
MR. DRAKE: You're not or you're now?
MR. BLEICHMAR: I'm not.
BY MR. BLEICHMAR:
Q. Do you see the second email from the
top on the first page? It's an email from you
dated August 10, 2007, to Ayca Pars?
A. Yes.
A. Yes.
A. Yes.
Q. Did you -- do you have any reason to
believe that this is not an authentic copy of this
email?
A. No.
Q. Who was Ayca Pars?
A. She was a business development and
marketing specialist in the Geneva office.
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Q. Do you see the prior email, on

page 2, from Ayca Pars to you, dated August 9,
2007?
A. Yes.
A. Yes.
of your general responsibilities while employed at
SIS?
A. Yes.
that that email is not authentic?
A. No.
Q. What is that email about?
MR. DRAKE: Do you want him to read it
and tell you?
MR. BLEICHMAR: Yes.
THE EXAMINER: I think he really needs
to go back to the beginning of the chain -THE WITNESS: Yes.
THE EXAMINER: -- to understand really
what's going on.
THE WITNESS: I think we do.
BY MR. BLEICHMAR:
Q. Feel free to go ahead and read the
email chain.
A. Could you ask your question again,
please?
Q. Sure. What is the general subject
of this email? What is this email about?
A. The email -- in August of 2007,
there were some very unusual movements in hedge
funds that conducted market-neutral and
statistical arbitrage strategies, and some of them
experienced losses that were not typical, and the
client, in this case, or the potential client,
I'm not sure which, was wanting to know whether
any of those effects had had an impact on any of
our funds or funds of funds.
Q. Do you know if the client was
Pioneer?
A. I don't.
THE EXAMINER: Sorry, the client was?
MR. BLEICHMAR: Pioneer.
THE WITNESS: I mean, I can't see it
anywhere, but -- I -- I don't know.
BY MR. BLEICHMAR:
A. We tended -- tended not to have
client contact from -- from New York. It was
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dealt with out of Geneva.

through 913 dated October 27, 2007.
BY MR. BLEICHMAR:
Q. Do you see that this document is
an email from you to Manuel Echeverria dated
October 27, 2007?
A. Yep.
Q. And there is a subsequent email -or there's an email below your email from
Mr. Echeverria to you, also -- actually dated
October 26, 2007; correct?
A. Yes.
Q. Did you send and receive those
two emails?
A. Yes.
Q. And did you send them and receive
them as part of your general responsibilities at
SIS?
A. Yes.
that those emails were -- are not authentic?
A. No.
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through 61.
BY MR. BLEICHMAR:
Q. Do you see that the top email is an
email from Jonathan Clark to you dated October 30,
2007?
A. Yes.
Q. And it is called -- and it is -- the
subject is "Madoff trading update"?
A. Yes.
Q. And did you receive that email?
A. Yes.
of your general responsibilities at SIS?
A. Yes.
that this document is not authentic?
A. No.
Q. And do you see that in that email
Jonathan Clark is forwarding you the email below?
A. Yes.
Q. Did you discuss with Mr. Clark the
email below from Ayca Pars to Mr. Clark?
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A. I don't recall doing so.

Q. Do you have an understanding -or did you have an understanding at the time as to
why Jonathan Clark forwarded you the email below?
A. I think Jonathan wanted to keep me
apprized of his activities and, you know, I think
he felt that it was -- he'd been useful in
developing business and that it was -- he wanted
recognition for his efforts in -- in doing that.
Q. Did he receive recognition for his
efforts in developing -- in developing business?
A. Well, assisting in the developing
business, yes, he did.
MR. BLEICHMAR: Let me mark exhibit 42
as document bearing Bates stamps 490500 through
502.
BY MR. BLEICHMAR:
from you to Jonathan Clark dated October 30th,
2007?
A. Yes.
Q. And did you send this email?
A. Yes.
general responsibilities as -- during your

employment at SIS?
A. Yes.
that this is not an authentic copy of this email?
A. No.
exhibit 43 a document bearing Bates stamps
4383194.
BY MR. BLEICHMAR:
includes an email from Jonathan Clark to you, also
dated October 30th, 2007?
A. Yes.
Q. Do you see that it says
"Audrey Tardy" on top?
A. Yes.
Q. Do you know who that is?
A. Yes. Yes, I do.
Q. Who is she?
A. She was a junior analyst from the
Geneva office who spent a bit of time in New York.
Q. Do you have any understanding or
any -- as to why her name appears on top there?
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A. Not unless she was logged onto

Jonathan's machine or -- I don't know.
THE EXAMINER: It usually denotes the
person who's printed it off.
THE WITNESS: Yeah.
BY MR. BLEICHMAR:
Q. Is that your understanding?
A. Yeah, normally, but it seems odd
that -- it just -- it looks odd. It's not in a
format I would expect to see it in.
THE EXAMINER: But the date at the
bottom left-hand corner is -- is three years after
the date of the -- dates of the emails in
question.
THE WITNESS: Yes.
BY MR. BLEICHMAR:
Q. Is it possible that she was bcc'd on
this document?
THE EXAMINER: Anything -- anything is
possible.
MR. DRAKE: Is there a man in the moon?
THE WITNESS: I don't know.
BY MR. BLEICHMAR:
Q. We're trying to figure out the
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document as much as you are.

A. Okay. Yes.
THE EXAMINER: I think it is the person
who printed it off, based on experience of having
seen thousands of other emails of similar types.
THE WITNESS: Yeah.
MR. DRAKE: Have you finished with that
email?
MR. BLEICHMAR: Yes, I have.
THE EXAMINER: This is 44?
MR. DRAKE: Is it January 2008?
MR. BLEICHMAR: I believe that's
correct.
MR. DRAKE: No, is that what it says on
the face of it?
MR. BLEICHMAR: Yes.
BY MR. BLEICHMAR:
Q. Do you know what this document is?
A. It looks like a presentation to
describe Optimal's risk management process.
Q. Did you participate in preparing
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this presentation?
Q. And why don't you think so?
A. Because it looks like it was
prepared by the risk -- the new risk team, the
then new risk team.
Q. When you say "the new risk team",
who are you referring to?
A. Gilles Prince and his team.
Q. And what was the new risk team by
Gilles Prince? Is "Gilles" G-I-L-L-E-S?
A. Yes.
Q. What are you referring to when you
say -A. Well, Rajiv Jaitly resigned in -- as
we just saw in that email, in the latter part of
2007, and he was promptly replaced by Gilles
Prince as chief risk officer, and this appears to
be Gilles Prince's blueprint for how he understood
and -- and wanted to present the risk management
processes.
Q. Did you see or review this document
while at SIS, during your employment there?
A. I -- I believe I saw it.
Q. Did you see it as part of your
general responsibilities at SIS?

A. Yes.
this document is not authentic?
A. No.
through 27, and that's dated March 14th, 2008.
BY MR. BLEICHMAR:
Q. Do you see the second email from the
top is an email from you to a large number of
recipients, dated March 14th, 2008?
A. Yes.
A. Yes.
A. Yes.
Q. Is this an authentic copy of the
email?
A. Yes.
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through 513.
BY MR. BLEICHMAR:
A. Yes.
Q. What do you recognize it to be?
A. I believe it to be a -- an iteration
or one of the versions of the way in which we
presented our investment process.
Q. And when you say "we presented",
presented to whom?
A. Well, I'm not sure, because there
were various versions of this document. Some were
internal and some were external. I'm not sure
which of those this one is.
Q. Did you participate in the
preparation of this document?
A. I'm not sure this document
specifically, but it was an evolving document and
I certainly participated in one or more of the
evolutions of this document.
Q. And did you participate in one or
more of the evolutions of this document as part of
your general responsibilities at SIS?
A. Yes.
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A. No.
MR. DRAKE: That's it?
MR. BLEICHMAR: Yes.
BY MR. BLEICHMAR:
there are two emails reflected in the first page,
one from Jonathan Clark to you dated April 15th,
2008, and a prior one from Mr. Adam Czub to you
and others, also dated April 15, 2008?
A. Yes.
Q. Did you receive both of these
emails?
A. Yes.
Q. Did you receive them as part of your
A. Yes.
A. No.
Q. Do you see the second email, the one
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from Mr. Czub, addresses FOFIX?

A. Yes.
Q. Was FOFIX used as part of the
due diligence process of SUS?
A. I need to be a bit more specific
about that, because I said the due diligence
process was the initial monitoring, typically, of
an investment -- sorry, the initial assessment of
an investment.
FOFIX was used much later on, because it
came in much later on, and I'm not sure whether
during my time it was used to assess SUS or not.
Q. You said it came on later on.
A. Yes.
Q. Approximately when did it come on?
A. It arrived with the quant team,
Gilles Prince and Adam Czub.
Q. Is that approximately in 2007?
A. I think so, yes.
Q. And could you explain, generally,
your understanding of FOFIX?
A. It's a quantitative system that
analyses the monthly performance figures for a
fund and seeks to make -- to draw conclusions
about the performance and the risks, and so forth,
of that fund.
Q. Did you apply this quantitative
system to Optimal SUS?
A. I did not.
BY MR. BLEICHMAR:
Q. Do you know if anyone at Optimal
applied this quantitative system to Optimal SUS?
A. I'm not sure if they did while I was
there.
Q. Do you know if they did after you
were there?
A. I -- I think they did, yes.
Q. And what is your understanding from
that?
A. I think it was -- my understanding
is that they had analyzed it, and I'm not sure
whether it happened before or after my time there,
and that the results were very positive. .
MR. BLEICHMAR: Let's take a -- let's go
off the record.
record at 2.24 p.m.
(2:24 p.m.)
(Break taken.)
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(2:39 p.m.)
BY MR. BLEICHMAR:
Q. Mr. Burnaby-Atkins, with your
counsel's indulgence, I'm just going to ask you a
few questions on your educational and professional
background, and then I'm going to let the
defendants continue the examination.
A. Okay.
Q. Could you tell me your educational
background, starting with university?
A. I was educated at the University of
Edinburgh. I studied bachelor of commerce and
business studies with finance and accountancy and
economics as parallel courses.
I then attended the Royal Military
Academy at Sandhurst and spent six years in the
British Army. I was a captain in the British
Army, did a couple of operational tours, in
Bosnia and Northern Ireland.
I was briefly a journalist, so I attended
journalism school as well, and then I joined -started in finance in 1988.
Do you want me to go through my career
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history as well? You said educational, but -Q. Let me break that down with a couple
of questions and then move on.
What degree in finance did you obtain
in -- is it 1988 or '98?
A. I obtained -- obtained my degree -degree in 1989.
Q. 1989. And is that your degree in
finance?
A. It was a bachelor of commerce, a
BComm degree.
Q. That was from the University of
Edinburgh?
A. University of Edinburgh, yes.
Q. Understood. And prior to starting
at SIS in April of 2003, where did you work?
A. Yeah. I worked at Bank of Bermuda
in London for four years, best part of four years.
I worked at Pavilion Capital, also in London, and
I started at SIS in 2003.
Q. And at the Bank of Bermuda, what
were generally your responsibilities?
A. I'm just going to add in one other
thing as well -- or sort of four other things as
well, because you asked me about educational
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background.
Prior to and during my professional
career, I also achieved the SFA's registered
representative qualification, which is an asset
management qualification; and I achieved the IMC,
investment management qualification, so another
investment management qualification; I achieved
the chartered financial analyst designation, which
is a three-year benchmark, I think sort of top of
the industry benchmark qualification; and I also
achieved the financial risk manager designation as
well.
So there's quite a lot of education that
took place while I was working.
Q. What year did you start at Bank of
Bermuda?
A. In 1998.
Q. And you worked there for four years,
you said?
A. Best part of four years. So it was
three and a half, three and three quarters.
Q. And then you went to Pavilion
Capital?
A. Yes.
Q. And how long were you there?
A. For almost a year. Not quite a

year.
Q. And from Pavilion Capital, you went
to SIS?
A. Yep.
Q. And what did you do at Pavilion
Capital?
A. I was a -- an analyst and portfolio
manager.
Q. Is that a similar type of job that
you had with SIS?
A. Yes.
Q. In what sense?
A. In that we were analyzing hedge
funds. My job was to conduct due diligence,
research analysis on hedge funds, and then to
construct the hedge funds that we approved for
investment into portfolios and create fund of
funds vehicles.
MR. BLEICHMAR: Thank you very much.
I reserve the rest of my time for redirect.
CROSS-EXAMINATION BY MR. DANON:
BY MR. DANON:
Q. Good afternoon, Mr. Burnaby-Atkins.
A. Good afternoon.
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Q. How are you doing?

A. Good.
Q. Good. Are you all right if we
continue?
A. Yep. Absolutely. Please.
Q. Okay. All right. Just to follow up
on what Mr. Bleichmar asked you about your
background, and particularly your background once
you started at Optimal.
MR. DRAKE: Can you keep your voice up?
It is hard to hear.
BY MR. DANON:
Q. Okay. Between 2003 and 2008, what
was the number of managers that you and the people
reporting to you were responsible for researching
and monitoring?
A. I couldn't put an exact number on
it. It was certainly hundreds, at least, if not
thousands; but a -- a tremendous number.
Q. And during your direct examination,
you were asked about Mr. Clark's responsibilities.
A. Yes.
Q. Do you -- do you recall that?
A. Yes.
Q. And Mr. Clark reported to you;
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correct?
A. Yes.
Q. Okay. And part of his
responsibilities, as you testified, was that he
was monitoring the Optimal SUS fund; is that
correct?
A. Correct.
Q. And part of that monitoring was
monitoring of the account at Madoff; is that
correct?
MR. BLEICHMAR: Objection: leading.
THE EXAMINER: Well, he's allowed to
lead. Isn't that the point of cross-examination?
MR. BLEICHMAR: My understanding -MR. DRAKE: You can't lead.
MR. BLEICHMAR: He has his -- he has his
examination, doesn't he? Isn't this his
examination?
THE EXAMINER: I always understood this
was direct examination, cross and re.
MR. BLEICHMAR: I take that back, then.
BY MR. DANON:
Q. Let me ask it to you again,
Mr. Burnaby-Atkins: can you tell us what were the
monitoring activities of Jonathan Clark that he
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performed in connection with the Optimal SUS fund?

A. He was formally tasked with
confirming that Madoff's strategy, as reported to
us by Madoff, was within the constraints imposed
by the trading authorization, the trading
directive, that had been agreed by the Geneva
office with -- with Mr. Madoff.
So it was a -- a fairly narrow set of
rules that he had to confirm formally. As we have
already described, we did a really colossal and
vast amount of research above and beyond that,
approaching it, I think, very aggressively,
cynically, with great care and -- and -- and
due diligence, but just to go back to the question
you asked specifically, his job was to take the
trade tickets that were sent to him, or sent to
Optimal by Madoff Securities, and confirm that the
activity within our account, as reported by
Mr. Madoff, was within constraints laid down by
that trading directive.
Q. Okay. And how frequently did he
prepare these reports?
A. On a monthly basis, but he would
produce more regular ad hoc reports between those
times, by way of wanting to keep people informed
of what he was up to, the work he was doing, and,

as he understood it and we understood it, how the
Madoff strategy was operating on a continuous
basis as much as possible.
Q. And I think you referred to this in
your -- in your prior response, but, in addition
to the authorization check list that he was doing,
he would also be performing other research
activities in connection with the Optimal SUS
fund; is that correct?
A. Yeah, and I -- I think one of the
points that maybe hasn't come out today is just
how much work we did, not just on this fund,
because this was only one in a range of products
that Optimal offered.
We had a lot of different products, and
we had, therefore, responsibility for analyzing,
evaluating, researching, conducting due diligence
on and monitoring a whole suite of other funds,
some which we were invested in, some which we were
considering investing in, so there was a
tremendous amount of work that was going on in
parallel to just this account, and hopefully one
thing that's become clear today is that, despite
those other responsibilities, the level of work
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that went into this really was of an exceptionally

high level.
MR. BLEICHMAR: I'm going to object to
this -- I'm going to object to this line of
questioning.
The topics of examination are limited to
due diligence of Optimal SUS. The functions of
Mr. Burnaby-Atkins and Mr. Clark outside of
Optimal SUS is not an issue of examination, it was
not covered by my direct.
THE EXAMINER: No, I understand that,
but I thought he was dealing with -- with
Mr. Clark's duties and job responsibilities. He
was fitting it into the context that they did a
hell of a lot of other things as well.
MR. BLEICHMAR: He's talking about all
these other funds that he's working on.
THE EXAMINER: Anyway, let's move on.
BY MR. DANON:
Q. Sitting here today,
Mr. Burnaby-Atkins, do you have any doubt that the
work that Mr. Clark and you did to research the
Optimal SUS fund was everything that you could do?
A. Absolutely everything we could do,
and we were continually searching and striving and
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finding -- trying to find new ways of -- of

conducting due diligence and monitoring this
investment. We -- we never stopped doing that,
and we were, I think, imaginative, thoughtful,
insightful and energetic in -- in our efforts
to -- to do that due diligence and that
monitoring.
BY MR. DANON:
Q. Let me show you what I have marked
as exhibits 48 and 49. For the record, those are
documents that were native produced, and the
Bates numbers that are connected with those are
OPTIMAL-000285558, and that's exhibit 48, and
exhibit 49 is OPTIMAL-000285658.
And, Mr. Burnaby-Atkins, can you please
look at those two exhibits. Do you recognize
those documents?
A. Yes.
Q. And do you recognize what those
documents are?
A. They are the spreadsheet that
Jonathan predominantly built, but I assisted him
in building, to help us monitor Madoff's trading
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activities.
MR. BLEICHMAR: Have these documents
been provided to the witness in advance, as we
did?
MR. DANON: These exact ones have not,
but you -- you had some in your category that were
the same ones.
MR. BLEICHMAR: Not these. That's why
I'm asking these specific ones. Did you provide
them to him in advance?
MR. DANON: No. But so the record is
clear, you had different months as your documents.
BY MR. DANON:
Q. And as far as you're aware, during
your time at Optimal -MR. BLEICHMAR: I do not believe
I showed him the document -- this type of
document, but the record is what it is.
THE EXAMINER: You didn't show him.
MR. DANON: You didn't show him; you
provided it to him beforehand.
MR. BLEICHMAR: I understand.
BY MR. DANON:
Q. Going back to it, during your time
at Optimal, from 2003 to 2008, and when this
monthly monitoring was implemented, was it your

understanding that Jonathan Clark conducted that
monitoring on a monthly basis?
A. Yes. Yes.
Q. Was there a period of time where he
did not conduct that monitoring?
A. The monthly monitoring? No, he
always conducted the monthly monitoring.
Q. Let me show you what was previously
shown to you as exhibit 30. I'm wondering if you
can look -- find exhibit 30 in front of you. And
if you look at this email, do you -- do you recall
seeing that email?
A. Yes, I do.
Q. And you recall seeing it during your
direct examination when Mr. Bleichmar was asking
you questions?
A. Yes.
Q. And in the second paragraph there
that starts with "Since February of this year", it
says:
"... this analysis is no longer produced
which surprised me."
Do you see that comment?
A. Yes.
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Q. Do you understand what Tasneem was

referring to and what the resolution of that issue
was?
A. Yes. She was referring to Jonathan
filling in that spreadsheet -- that specific
spreadsheet, which was a spreadsheet, by the way,
that he had built, again, as I said, with my
assistance, so there was no formal requirement to
use that spreadsheet.
However, it was deemed to be a useful
tool and, if nothing else, illustrates how careful
we were in conducting the monitoring and analysis,
and, for a period of time, he -- he received the
trade tickets, continued to monitor them,
continued to confirm and report -- I understood
that he did that in good faith -- that Madoff was
within the constraints, but I believe he didn't
specifically use that spreadsheet for a period of
time.
My understanding is that, on Tasneem's
request, that spreadsheet was then backfilled and
everything was confirmed and validated and that
everything was, you know, ultimately done belt and
braces.
Q. As part of Mr. Clark's
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responsibilities, was he involved in any of the

drafting or comments of the explanatory
memorandum?
A. Not as far as I'm aware.
Q. Were you involved in any of the -A. No.
Q. -- commenting and drafting of the
explanatory memorandum?
A. No.
Q. And you understand what I mean by
"the explanatory memorandum"; correct?
A. Yes.
Q. During the questioning by
Mr. Bleichmar, there were questions regarding
Mr. Rajiv Jaitly. Do you -- do you recall -A. Yes.
Q. -- questions about Mr. Rajiv Jaitly?
And Mr. Rajiv Jaitly joined Optimal what year;
do you recall?
A. In the middle of 2005.
MR. BLEICHMAR: Objection. I don't
think I asked any questions about
Mr. Rajiv Jaitly.
BY MR. DANON:
Q. He showed you emails regarding
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Mr. Jaitly, did he not?

MR. BLEICHMAR: Well, I don't think the
emails -MR. DANON: And -MR. BLEICHMAR: I asked about
authentication.
MR. DANON: Yeah, I can -- I can inquire
into Mr. Jaitly. You examined into his report.
BY MR. DANON:
Q. Did you not -- did you receive -A. I did see Mr. Jaitly's report.
Q. Do you -- do you recall getting an
exhibit on direct which was a -- a report -A. Yeah, produced by Mr. Jaitly.
Q. -- by Mr. Jaitly, right, and you
were asked questions about a meeting -A. A meeting with Mr. Jaitly.
THE COURT REPORTER: Sorry, can I just
have one person at a time.
THE EXAMINER: I thought there were
questions about a meeting between this witness,
Mr. Jaitly and Mr. Madoff.
MR. BLEICHMAR: Fair enough.
BY MR. DANON:
Q. And you were asked to identify what
Mr. Jaitly's position was, was it not?

A. Yes.
Q. Okay. And he was in operational
due diligence; is that right?
A. He was the chief risk officer and,
therefore, responsible for operational
due diligence.
Q. And prior to Mr. Jaitly joining
Optimal, was Optimal conducting operational
due diligence?
A. Yes.
Q. And how was it doing that?
A. The investment team was doing that.
Q. And the investment team?
A. Including myself.
Q. Including yourself and -A. And Jonathan and -- and other
analysts as well.
Q. And it also included operational
due diligence on Optimal SUS; correct?
A. Yes, and that was shown in that
report that we summarized for 2006, the end part
of 2006.
Q. And just to jump ahead here, that
was -- you're referring to exhibit 25 -- is that
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correct? -- which is the July 2006 Jonathan Clark

report?
A. Yes, of which -- well, there were
two versions of it, weren't there, but -Q. Correct.
A. The July 2006 one, yes.
Q. Let me ask you if you can look at
exhibit 21 that was shown to you during
Mr. Bleichmar's questions.
A. Yes.
Q. Do you see exhibit 21? Exhibit 21
was Jonathan Clark's memorandum of the meeting
that was held February 1st, 2006 with Mr. Madoff;
correct?
A. Yes.
Q. Okay. And Mr. Jaitly was at that
meeting?
A. Yes.
Q. You were at that meeting?
A. Yes.
Q. And so was Mr. Clark?
A. Yes.
Q. Was Manuel Echeverria at that
meeting?
A. No.
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Q. Was Manuel Echeverria at Madoff's

offices that day?
Q. Were you given any instructions by
Mr. Echeverria prior to that meeting to limit any
of the questions that would be asked of
Mr. Madoff?
A. Absolutely not.
Q. Did -THE EXAMINER: Sorry, "absolutely"?
THE WITNESS: Absolutely not.
BY MR. DANON:
Q. Were you instructed by anyone at
Optimal to limit the questions that Mr. Jaitly
could ask of Mr. Madoff?
A. No.
Q. Did you, yourself, during that
meeting, limit any of the questions that
Mr. Jaitly asked or wanted to ask Mr. Madoff?
A. No. Quite the opposite. I was very
supportive and encouraging of him, and felt that
he was a highly experienced and qualified
individual and that he would be a very useful,
helpful tool in carrying out our work.
Q. And did Mr. Clark limit any of the
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questions that Mr. Jaitly was asking Mr. Madoff?

A. No. Again, he -- he -- he felt the
same way that I did.
Q. And during that visit, did you have
the opportunity to walk around the offices?
A. Yes, we did.
Q. And did Mr. Madoff offer to show you
portions of the office?
A. Yes, he did.
Q. And did you, at any time, stop
Mr. Madoff or suggest that it wasn't necessary to
see any of the space?
A. No, we were very keen to see it.
Q. I'd like you to refer to exhibit 23,
which was shown to you during your questioning.
And do you recall, this is -- well, let me ask
you. Do you -- do you know what this document is?
A. Yeah, this is the report produced by
Mr. Jaitly after his visit to Madoff's offices.
Q. And do you recall when Mr. Jaitly
completed his report?
A. Quite some time afterwards.
Q. And if you turn to the first page of
exhibit 23, the very first page, which is the
email cover page, does that give you a -- refresh
your recollection as to the timing of when

Mr. Jaitly distributed his report?
A. It looks like it was sent in -in October, relating to a February meeting.
Q. And if you -- if you go back to
exhibit 25, which is Jonathan Clark's report of -of July 2006, was Jonathan Clark's report, as
shown in exhibit 25, completed and distributed
prior to -A. I've lost 25.
Q. There you go. Have you got 25 in
front of you?
A. Yes.
Q. So was Mr. Clark's report, as shown
in exhibit 25 -MR. DRAKE: Sorry. If he hands me the
exhibits and I can put them in an order and
present them.
THE EXAMINER: Thank you. Twenty-three
and 25 are the two -THE WITNESS: I have 25 here. I don't
have 23.
THE EXAMINER: Have a look at my 23,
if it helps.
MR. DRAKE: No, he has 23.
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THE WITNESS: I have 25. I have 25.

BY MR. DANON:
Q. You had 23 in front of you.
A. Okay.
Q. Let me just start over here.
Looking at exhibit 25, which is
Jonathan Clark's July 2006 report, was
Jonathan Clark's report completed and distributed
to -- to people at Optimal prior to or -- prior to
Mr. Jaitly's report, as indicated by exhibit 23?
A. I believe it was completed before
Mr. Jaitly's report.
Q. And if you turn to exhibit 23, which
you have in front of you, which is Mr. Jaitly's
report, and if you look at between sections G and
H, there is some language in bold and underlined?
A. Yep.
Q. And that language says:
"Given the apparent sensitivity of the
relationship with this manager no request was made
to review how a trade is made and allocated to a
client - however I note that the investment team
has recorded that a Fairfield Partner has
previously been given such access and there is
absolutely no reason why we should not make a
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similar request."
During your visit with Mr. Madoff in
February 1, 2006, was there an instruction by
anyone at Optimal to not ask Mr. Madoff for or
request a review of trade?
A. Not that I was party to.
Q. Do you know whether or not
Manuel Echeverria had given an instruction to
Mr. Jaitly?
A. I don't know. I don't know.
Q. And during that meeting, as far as
you were aware, does Mr. Jaitly have the ability
to ask that question of Mr. Madoff if he wanted
to?
A. In principle, yes.
Q. If you turn back a couple of
pages -MR. DRAKE: Still in 23?
BY MR. DANON:
Q. Still in exhibit 23. If you -I think -- let me count them out here. If you
go to the third page, and it's something indicated
as 4, paragraph number 4, "Risk of Fraud and
misrepresentation of process"?
A. Which -- what's the number on the
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bottom?
Q. The number on the bottom is -A. Oh, here we go. I've got it.
Q. -- 000434821.
A. Okay. Got it. Yep.
Q. Okay. And in there it refers to a
report, an SAS 70 report. Do you know what an
SAS 70 report is?
A. Yes.
Q. And what was your understanding of
what that report was?
A. An SAS 70 report -- I don't know
what it stands for, but it's a standards of
practice report that an organization -- and it can
be any organization -- will submit to voluntarily,
and at the end of it, the report will give an
assessment of its -- of its operating practices
and procedures.
Q. I want to just follow up on that.
You said it's voluntary.
A. Yes.
Q. So that means that companies are not
obligated to do this?
A. No, not that I -- not that
I understand.
Q. And in your experience of the

hundreds of managers that you were meeting with
and -- and monitoring and investigating as part of
your job, how many of those managers had an SAS 70
report?
A. Almost none. I mean, it was -- we
very rarely saw this. It was very unusual.
Q. And -- and during this visit in
February 2006, was Mr. Jaitly discouraged or
precluded from asking Mr. Madoff about an SAS 70
report?
A. No.
Q. Did Manuel Echeverria ever tell you
that you could not ask Mr. Madoff for an SAS 70
report?
A. No.
Q. Did Manuel Echeverria limit any of
the questions that you personally could ask
Mr. Madoff?
A. No.
Q. Going back to exhibit 25, on page 6,
towards the bottom, in the financial reporting -THE EXAMINER: Page 6?
MR. DANON: Okay. At the bottom, it is
839539. The page numbers are on the top right.
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THE EXAMINER: Thank you. Got it.

BY MR. DANON:
Q. Okay. So it's page 6 of the report,
and on the Bates number it's 839539, and in the
bottom, under "Financial reporting", there's a
reference to "Madoff Audit". Do you see that?
A. Yep.
Q. And there's a reference to a meeting
with David Friehling on July 11th?
A. Yep.
Q. Did you attend that meeting on
July 11th?
A. Yes.
Q. And who else was at that meeting on
July 11th?
A. Myself and Jonathan Clark,
Mr. Madoff, Bernard Madoff, David Friehling, and
Rajiv Jaitly attended by telephone.
Q. And did Mr. Jaitly attend that
phone -- that meeting by phone for the entirety of
the meeting?
A. I think so, yes.
Q. And at that meeting did you limit
what Mr. Jaitly could ask of Mr. Madoff -A. No.
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Q. -- or his auditor, Mr. Friehling?

A. No.
Q. Were you encouraging any questions
from Mr. Jaitly?
A. Yeah, I felt Mr. Jaitly was a
chartered accountant, a very qualified chartered
accountant, and I was very keen for him to exploit
his credentials and his capabilities to -- to ask
searching questions.
Q. And, as a result of that meeting,
what do you recall learning?
A. We learnt that, according to
Mr. Friehling, the assets of our account were
properly segregated, and we were given -- we were
led to believe by Mr. Friehling that the full
audit was conducted on a regular basis and that
there was no qualification of that audit and that
everything that one ought to expect during the
audit of a broker dealer to be in place was,
in fact, in place.
Q. I want to refer you to exhibit 29
that was shown to you by the plaintiffs.
MR. DRAKE: Have you finished with the
other exhibits?
MR. DANON: No, I'm not. Thanks.
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BY MR. DANON:
Q. And if you look at page 2 of the
email, and I believe it's right in the middle, and
it -- it seems to be highlighted. There -- first
of all, this is an email that you wrote; correct?
A. Yes.
Q. And in that middle section that
starts "Rajiv was objecting this week" -- can you
see that part?
A. Yes.
Q. Okay. Did there come a time that
you had mentioned and -- and raised issues
regarding Mr. Rajiv's completion of reports?
A. Yes.
Q. And -- and is this paragraph
representative of that?
A. No, I'm not sure that that
explicitly says that he was behind on -- on his
reports there. There are other places perhaps he
did, but not there.
Q. And if you look at the paragraph
right before that?
A. Yeah, the -- the paragraph before
does, yeah. He's only recorded two of those
meetings in the reports, yeah.
Q. You were concerned about

Mr. Jaitly's timeliness in completing the reports;
is that correct?
A. Yes.
Q. Can you verbally respond?
A. Sorry, yes. I'll speak up.
MR. DANON: Let me also show you what
I will mark as exhibit 50, and I only have one
copy there, but it was tab 16 in the binders, the
original documents provided to him.
BY MR. DANON:
Q. And, in fact, you corresponded
and -- with Rajiv and explained to him your
concerns about getting the reports -- reports
completed; is that correct?
A. Yep.
MR. DRAKE: Sorry to interrupt you, this
is a -- do you have it in front of you?
MR. DANON: I do not.
MR. DRAKE: I just want to understand
what it is.
MR. DANON: Yes. Hold on one second.
MR. DRAKE: It's an email dated June 8,
2006 from Mr. Burnaby-Atkins to Mr. Jaitly.
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MR. DANON: And it is Bates number

000213101 and 213102. It is a June 8, 2006 email.
BY MR. DANON:
Q. Do you recognize that document?
A. Yes.
Q. And that's your email?
A. Yes.
MR. BLEICHMAR: I'm going to object, to
the extent that this is not relating to Optimal
SUS and we had not shown him that email before.
THE EXAMINER: You haven't shown him
this email, but I understand he's simply limited
by this document. He's not limited to documents
that you have shown him.
MR. BLEICHMAR: I understand, but this
document does not relate to Optimal SUS.
THE EXAMINER: Does it not?
It's in the context that he took
eight months to produce his report on Madoff,
his Madoff visit.
MR. BLEICHMAR: You're giving him more
leeway than I got.
MR. DRAKE: Well, that really is pot
calling the kettle black.
MR. DANON: We'll move on.
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BY MR. DANON:
Q. Mr. Burnaby-Atkins, in your
questions from Mr. Bleichmar you had also -he'd asked you some questions about the risk rules
that Mr. Amadeo Reynes would receive reports on?
A. Yes.
Q. Okay. The risk rules themselves had
to deal with diversification in a fund of fund; is
that correct?
A. Among other things, yes.
Q. Okay. But was that your
understanding of what was being reported?
A. Among other things. So it was not
just that, but that was one of the components of
the risk rules.
Q. Okay. And what was the other
components of the risk rules?
A. There were some performance risk
limits as well, which were quite important too.
Q. Performance of the fund?
A. Performance of the underlying funds,
yes.
Q. Okay. And let me ask you to pull
out exhibit 44; do you have that in front of you?
A. Yes.
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Q. Okay. If you turn to page 20 of

exhibit 44, are the -- are the examples that are
listed here the categories that you are referring
to when you talk about risk rules?
A. Yes, they are.
Q. Can you now turn to exhibit 10?
MR. DRAKE: Are you done with the -MR. DANON: Yes, all except exhibit 25.
MR. DRAKE: Keep 25. Give us the rest
back.
BY MR. DANON:
Q. Do you have exhibit 10 in front of
you?
A. I do now.
Q. You do now. And that is a June
16th, 2004 email?
A. Yes.
Q. Do you recall that email?
A. Yes.
Q. Okay. In -- in paragraph -- the
third paragraph of this email, you write:
"SUPPOSE this was the largest Ponzi
scheme in history - unpalatable but we are not the
first to suggest it ..."
Who else had suggested it at that time
that you were referring to?

A. There were a couple of press
articles, one that appeared in Barrons and one
that appeared in MAR Hedge, which implicitly
suggested it.
THE EXAMINER: Sorry, which implicitly
suggested?
THE WITNESS: Implicitly suggested.
THE EXAMINER: No, I understand what you
mean.
THE WITNESS: I'm being careful in my
words here.
THE EXAMINER: Yes.
THE WITNESS: They didn't come out and
say it, because it would have been defamatory to
have said it, but they -- they certainly suggested
it.
THE EXAMINER: Well, it wouldn't have
been defamatory, it would have been true.
THE WITNESS: Well, it wouldn't have
been ultimately, but they might -- yeah.
And there was -- and I'm not sure whether
it happened about the time of this, but I know
that the senior partner at Albourne Partners had
also suggested it.
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And -- I mean, those are the most

prominent ones, but occasionally you would hear
people raise question marks over it as a strategy.
BY MR. DANON:
Q. And -- and you go on in that
paragraph to say:
"Even in a worst case, this scenario is
more than ... unlikely ..."
THE EXAMINER: "More than a little
unlikely".
BY MR. DANON:
Q. "More than a little unlikely". What
did -- why did you believe that?
A. Well, again, I think I was choosing
my words very carefully, so I'll just say that.
But fraud is unlikely. It just is very unlikely,
whether you like it or not.
But, above and beyond that, when you
looked at the Madoff entity, and our fund fed into
it, it had been running for a very long time, so
to keep a fraud going is difficult, but to keep it
going for a long time is even more difficult, so
that was another reason why it was unlikely.
Another reason it was unlikely was the
prominence and profile of Mr. Madoff himself, who
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was a very, very high-profile individual in the

industry who'd held -- held a number of very
senior positions, so, again, to think that an
individual of that stature could be perpetrating a
fraud was another reason to doubt those who
suggested it.
And then you'll see my own logic
underneath there, that if you want to commit a
fraud, there are probably easier ways to do it
than ultimately he went about it. But ...
Q. And -- and when you sent this email
on June 16th, 2004, did you, in fact, believe that
Madoff was operating a ponzi scheme?
A. No, I didn't.
Q. And at the time you sent this email,
did you believe that SUS should not be invested
with Madoff?
A. No, I didn't.
Q. Are you aware of anyone at Optimal
at any time during your -- your time at Optimal,
from 2003 to December 2008, that
concluded/believed that Mr. Madoff was running -running a ponzi scheme?
A. No-one concluded it was a ponzi
scheme.
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Q. Had anyone at Optimal ever, I guess,

discouraged you from asking the sort of questions
that you asked in this email?
A. No, and, as I think a lot of what
we've seen today shows, we systematically set
about answering all of those questions -- or
trying to answer those questions, and we were -we were thorough and -- and energetic in trying to
do that.
Q. And that's my follow-up question,
which is what -- what do you recall doing after
this email in -- in the attempts to answer some of
those questions?
A. I think we did everything we could.
I really -- you know, even in hindsight from this
remove and as frustrated as one feels that one
didn't change the course of history, I don't think
there's anything more we could have done, and
I also don't think there's anything that's
emerged, or any of the risk factors that have
emerged, that we didn't identify when we were
going through our -- our due diligence and our
monitoring.
So we found all the red flags. We drew
everyone's attention to them. We sent them up the
chain of command and we did everything I think

that we -- we conceivably could have done, and we
tried doing things by asking around the industry
to go beyond, and a lot of this, I said at the
beginning, is, remember, we were -- we had a
fairly narrow mandate of what we were supposed to
do, and we went vastly far beyond that in -- in -in trying to discharge our duty of care.
Q. And if you go back to exhibit 25 -THE EXAMINER: Can I just ask one thing
before you leave this one, 10.
MR. DANON: Okay.
THE EXAMINER: You -- just past what
Mr. Danon has read to you:
"SUPPOSE this was the largest Ponzi
scheme in history - unpalatable ..."
Et cetera:
"... he would need ..."
And you set out two things that he would
need to do, the second of which you said could
have been achieved if there really were no trades.
As I understood your testimony earlier,
you did establish that, in fact, there were
trades?
THE WITNESS: Exactly. There were
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trades.
THE EXAMINER: Through the DTC?
THE WITNESS: Through the DTCC.
THE EXAMINER: So that -- that's
obvious: well, he wasn't trading at all?
THE WITNESS: Which, as I said earlier,
some people suggested that he never did any
trades. Well, that's wrong. He did do trades.
And we verified that, and we verified that with -you know, from an absolutely cast-iron source, the
DTCC, which had no motives for telling us
otherwise.
MR. BLEICHMAR: I object to that answer
and preserve my objections.
THE EXAMINER: Thank you. Sorry, back
to 25.
BY MR. DANON:
Q. Okay. So I will -THE EXAMINER: No, no.
MR. DANON: No, no, no.
BY MR. DANON:
Q. Mr. Burnaby-Atkins, just to ask you,
if you look at that email and point 2 in the third
paragraph, where it says, "Ensure that no-one
knew which trades ... [or there] were no trades",
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did you get any information confirming that

Mr. Madoff was actually trading?
A. Yes, we did.
Q. And -- and what was that
information?
A. We -- we called the DTCC to verify
that he was trading, and they confirmed that he
was trading. We were unable to confirm what size
and for which accounts, but we confirmed that he
was trading, and that's been borne out by
everything that's emerged since then.
He ran a -- he turned out to be running
from his proprietary trading business and it was a
mask for what he was otherwise doing, but it was a
successful mask and we were unable to penetrate
it.
Q. And going back to exhibit 25, just
to -- to finish up with this, exhibit 25, you had
asked Mr. Clark to prepare this report; is that
correct?
A. Yes.
Q. Okay. And this is almost two years
after this June 16th email; right? July 2006?
A. Yes.
Q. And after all the work that was done
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and as represented by Mr. Clark, did you have any

belief or conclusion that Mr. Madoff was running a
ponzi scheme?
A. No, there was no conclusion that he
was running a ponzi scheme. You couldn't rule the
possibility out altogether, but then you could not
rule that possibility out with the vast majority
of organizations and -- and fraud occurs regularly
and consistently in the financial services
industry, and I'm sure it will again, but there
was nothing to suggest to us that there was a
fraud taking place.
Q. And, as a result of this report,
July 2006, as shown in exhibit 25, was there
anything to suggest to you that SUS should not be
invested with Mr. Madoff?
A. No, and -- and just to link your
earlier question -MR. DRAKE: Sorry to interrupt, but
you're asking him at the time?
MR. DANON: Yes.
THE WITNESS: At the time, yes.
And -- and to perhaps link those
two things together, 2004 and 2006, and everything
that was summarized in that report that I asked
Jonathan Clark to complete to ensure that we

handed over completely and fully the operational
risk assessment that we had done to the dedicated
operational risk team, you can see that we ask a
lot of searching questions in 2004 and, in the
interim two years, we go to, really, very, very
great lengths to try to answer those questions
and, you know, the word "due diligence", I think
we were extremely diligent and way beyond what was
due in -- in doing that, and that's summarized in
that report.
MR. DANON: Okay. Just give me a
second.
MR. DRAKE: No further questions?
MR. DANON: No further questions.
MR. BLEICHMAR: Give us two minutes to
confer?
THE EXAMINER: Yes.
MR. BLEICHMAR: Thank you. Let's go off
the record.
record at 3.23 p.m.
(3:23 p.m.)
(Break taken.)
(3:33 p.m.)
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RE-EXAMINATION BY MR. BLEICHMAR:
BY MR. BLEICHMAR:
Q. Mr. Burnaby-Atkins, do you remember
your recent testimony to the questions of
Mr. Danon concerning a review of a trade by
Mr. Madoff?
A. Yes.
Q. Did you ask Mr. Madoff to review a
trade?
A. I did not.
Q. Did Mr. Clark, as far as you know,
ask Mr. Madoff to review a trade?
A. Not as far as I know.
Q. In your testimony to -- in response
to the questions by Mr. Danon, you also discussed
a report called a SAS 70 report; is that right?
A. Yes.
Q. What is your understanding of a -of what a SAS 70 report is?
A. I repeat what I said earlier:
it's a voluntary report which is prepared by a
third party, which an organization will submit to
voluntarily in order to demonstrate the quality of
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its systems and operations and procedures.

Q. Is it a report that has to do with
the auditing of a -- of an entity?
A. It's a different -MR. DANON: Object to form.
THE WITNESS: -- kind of audit. I'm
not even sure what SAS 70 stands for, so I'm kind
of -BY MR. BLEICHMAR:
Q. Is it your understanding that a
SAS 70 report is subject to the -- under the
United States, the general accounting auditing
practices?
A. I don't know.
Q. Okay.
THE EXAMINER: Could it be described as
an operational audit?
THE WITNESS: Yes, exactly. Exactly.
BY MR. BLEICHMAR:
Q. Are you an auditor?
A. I'm not.
Q. Did you ever send any emails
concerning other funds raising the possibility
that there was a ponzi scheme?
A. I don't know. I don't recall doing
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so. There were periodic frauds in the industry,

so it's possible that I would have sent one
relating to one of those.
Q. But sitting here today, you do not
recall any other email, other than the one that
Mr. Danon and I showed to you concerning Optimal
SUS, that raised the possibility that the fund
could have been a ponzi scheme; is that right?
A. I don't recall one, but that's not
to say I didn't send one.
Q. And you understand that we're
talking about sending an email prior to the fraud
being exposed; correct?
A. Yes. Yes.
Q. Are you paying the legal fees of
your counsel here?
MR. DRAKE: That is a privileged matter
and I'm going to direct him not to answer.
MR. BLEICHMAR: That was a question that
was allowed with respect to Mr. Jaitly's
testimony.
THE EXAMINER: Yes. Why is it
privileged, who's paying the fees?
MR. DRAKE: The question of who is
paying his fees is a privileged matter.
MR. BLEICHMAR: I do not believe it is.

I believe that it does not go to the substance of
advice provided by counsel. It is the same as
asking the witness whether he met with counsel or
whether he had conversations with counsel and the
length of the conversations with counsel, but it
does not go to the legal advice. In fact, at
least in the United States, the defendants have
provided that information with respect to other
witnesses.
MR. DANON: That was for an employee of
ours, and it was asked the question when the
company itself was a defendant.
I think -- you know, this is a third
party witness who has got his own counsel here.
THE EXAMINER: We had all this on Monday
relating to Mr. Jaitly. He had his own solicitor
here.
MR. DANON: Yes.
THE EXAMINER: There was evidence about
who was paying for his time and who was paying his
fees.
MR. DRAKE: Well -THE EXAMINER: I haven't forgotten your
objection --
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MR. DRAKE: No.

THE EXAMINER: -- don't worry.
MR. DRAKE: I have two objections.
THE EXAMINER: Your objection is,
firstly, it's privileged.
MR. DRAKE: And, secondly -THE EXAMINER: I have to say, at the
moment, I don't understand the basis for that,
simply who is the paying party.
MR. DRAKE: Well, who is the paying
party goes to the relationship that
Mr. Burnaby-Atkins has with his lawyers. It's
nothing to the point whether he's being supported
by someone else, by -THE EXAMINER: Yeah, but that's -that's a different point. One, you say it is
privileged.
MR. DRAKE: Yes.
THE EXAMINER: At the moment, I don't
understand that. Secondly, you say it's
irrelevant.
MR. DRAKE: Well, but -- my first point
is that it's privileged. My second point is that
it's certainly without the scope of the subject
matter to which they're entitled to ask questions.
72 (Pages 282 to 285)

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MR. DANON: And it's outside the scope

of the recross.
MR. DRAKE: Yes, and, third -THE EXAMINER: You allowed all this on
Monday relating to Mr. Jaitly. I'm not sure
you're in the best position to object to it.
MR. DRAKE: Yes, but it certainly
doesn't arise as a result of anything that was
put.
THE EXAMINER: No, that is a slight
problem.
MR. BLEICHMAR: Well, it -- it arises to
the extent that the testimony was prepared in
conjunction with defense counsel, and that's where
I'm heading to and that's why I'd like to probe.
MR. DRAKE: Well, you can't say that.
MR. DANON: I will -- I will clarify
this with Mr. Jaitly. It was Mr. Jaitly who could
raise that -- that privilege if he wanted to.
Right now, it is Mr. Drake, on behalf of
Mr. Burnaby-Atkins, who is asserting that
privilege.
I asserted the privilege when I was there
with Mr. Jaitly on other issues. They were
privileges of the bank.
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THE EXAMINER: I still don't understand

the basis on which it's privileged.
MR. DRAKE: The basis on which it's
privileged, if I need to go to that, with
respect -THE EXAMINER: You say it is outside the
scope; I understand that.
MR. DRAKE: Well, I say both -THE EXAMINER: And you say it's raised
for the first time in re-examination.
MR. DRAKE: Right. So if I don't have
to -- if I don't win on either of those, and at
the moment I can't see how I don't win on both,
then I assert the privilege.
THE EXAMINER: How can you come to this
in re-examination? This should have formed part
of your examination-in-chief. Now, I know you
have faced an objection based on privilege, but
the order entitles Mr. Danon to time with this
witness.
MR. BLEICHMAR: Let me set the -- try to
set the basis a different way, then.
THE EXAMINER: All right.
BY MR. BLEICHMAR:
Q. Did you meet with Mr. Danon in
preparation for your testimony here?

MR. DRAKE: That's privileged as well.
Who he met with -THE EXAMINER: No, I don't agree.
What was discussed between them is privileged.
Who he met with, I don't regard as privileged.
MR. DRAKE: Well -- well, I do disagree.
Who he met with in the context of preparation for
his examination is a privileged question, in the
same way that which documents he looked at is a
privileged matter.
THE EXAMINER: I don't agree with that
either.
MR. DRAKE: Well -THE EXAMINER: What was discussed
between he and his attorneys about those documents
is undoubtedly privileged.
MR. DRAKE: Including the documents
themselves. Including the documents themselves.
THE EXAMINER: I take a different view
on that.
MR. BLEICHMAR: Isn't the only privilege
if Mr. Danon's as lawyer -MR. DRAKE: No, it isn't, and if we're
going to get into this -- and I wasn't aware that,
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certainly at quarter to 4, at the end of the

examination, we were going to have a debate about
privilege.
But if we're going to get into this,
there are any number of privileges that attach
here. One is his -- the witness's own
privilege -THE EXAMINER: Yeah, well, I understand
he has his own privilege.
MR. DRAKE: That is what's being
asserted.
The second is a common interest
privilege, because there's an interest between -the defendants here and Mr. Burnaby-Atkins are
sufficiently aligned so as to give rise to a
common interest privilege, and that would draw a
blanket over any conversation that he had with any
counsel for any of the defendants.
So on both -- on -- on both counts
this -- this area of inquiry is unprofitable.
THE EXAMINER: I am entitled to direct a
witness to answer a question, even if the issue of
privilege is raised.
MR. DRAKE: You are, and it would go in
a separate transcript.
73 (Pages 286 to 289)

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THE EXAMINER: It normally would go in a

sealed transcript, to be to be held by the Master.
MR. DRAKE: Yep. Yep.
THE EXAMINER: In my view, the question,
who did he meet with for the purpose of this
deposition, is a question that either is not
privileged or, even if it is, I am going to direct
him to answer.
MR. DRAKE: Well, if you do direct him
to -- if you do direct him to answer that, it has
to go in a separate transcript.
THE EXAMINER: The rest of the procedure
has to be followed, I entirely agree. But I'm not
going to allow him to go further than who did he
meet with.
MR. DRAKE: Well, then, it needs to be
noted that -- that the question and the answer
needs to reside in a separate transcript and needs
to be submitted separately to the Senior Master.
THE EXAMINER: Yes. Well, I -- I am
familiar with the remainder of the procedure in
that part of the law, at Part 34.
Can you physically do that, simply put it
into a separate page with a separate heading?
THE COURT REPORTER: Sure.
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MR. BLEICHMAR: Thank you very much,

Mr. Burnaby-Atkins.
THE EXAMINER: Thank you. That
concludes your deposition.
THE WITNESS: Thank you very much.
THE VIDEO OPERATOR: Here marks the end
of videotape number 3 in the deposition of
Mr. Hugh Burnaby-Atkins.
Going off the record. The time is
3.45 p.m.
(Whereupon, the deposition
concluded at 3:45 p.m.)
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THE EXAMINER: Okay. So do you want to

ask who he met with?
(Pages 292-301,
Being asserted privileged testimony,
extracted to separate transcript.)
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Page No
CORRECTIONS PAGE
Line No
Description
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CONFIDENTIAL
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DEPONENT'S DECLARATION
I,
, hereby declare
under penalty of perjury under the laws of the
United States and the State of New York that I
have read the foregoing transcript and identify it
as my own and approve same as a true and correct
transcript save and except for changes and/or
corrections, if any, as indicated by me on the
CORRECTIONS page hereof.
,
Date
,
City
,
State
Signed:
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REPORTER'S CERTIFICATE
I, Judith White, of Merrill Legal
Solutions Pty Limited, do hereby certify that the
foregoing testimony was recorded by me
stenographically and thereafter transcribed by me,
and that the foregoing transcript constitutes a
full, true and accurate record of said examination
of and testimony given by said witness, and of all
other proceedings had during the taking of said
deposition, and of the whole thereof, to the best
of my ability.
I further certify that I am not a
relative, employee or counsel of any of the
parties of the within cause, nor am I an employee
or relative of any counsel for the parties, nor am
I in any way interested in the outcome of the
within cause.
Signed _______________________ Dated ________

(Judith White)
75 (Pages 304 to 305)

1-800-325-3376

In The Matter Of:

OPTIMALU.S.LITIGATION
___________________________________________________
HUGHBURNABYATKINSVol.1
July18,2012
___________________________________________________
EXTRACTED ASSERTED PRIVILEGED

TESTIMONY FROM CONFIDENTIAL DEPOSITION
EXTRACTED ASSERTED PRIVILEGED TESTIMONY

Page 292
IN THE UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - -
IN RE OPTIMAL U.S. LITIGATION
)
)
)
)
)
)
)
)
)
)
CIVIL ACTION NO:

10-CV-4095 (SAS)
- - - - - - - - - - - - - - - - -
EXTRACTED ASSERTED PRIVILEGED TESTIMONY FROM

CONFIDENTIAL VIDEOTAPED DEPOSITION OF
MR. HUGH BURNABY-ATKINS
BEFORE THE EXAMINER MR. ALLEN DYER
VOLUME I
Wednesday, July 18, 2012
Taken at:
Merrill Corporation
Level 2
101 Finsbury Pavement
London, EC2A 1ER
Court Reporter:
JUDITH WHITE
1-800-325-3376


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APPEARANCES
Page 295
1
2
Appearing on behalf of the Plaintiffs:
JAVIER BLEICHMAR
LABATON SUCHAROW
140 Broadway
New York, NY 10005
Telephone: 212.907.0887
Email:
jbleichmar@labaton.com
4
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ALAN I. ELLMAN
LABATON SUCHAROW
140 Broadway
New York, NY 10005
Telephone: 212.907.0877
Email:
aellman@labaton.com
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MICHAEL L. GREENWALD
GREENWALD DAVIDSON PLLC
5550 Glades Road
Suite 500
Boca Raton, FL 33431
Telephone: 561.826.5477
Email:
mgreenwald@mgjdlaw.com
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RICHARD HOMEWOOD
RICHARD SLADE AND COMPANY
Ground Floor East
9 Gray's Inn Square
London WC1R 5JD
Email:
richard.homewood@richardslade.com
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Appearing on behalf the Defendants:

SAMUEL A. DANON
Suite 2500
Miami, FL 33131
Telephone: 305.810.2510
Email: sdanon@hunton.com
GUSTAVO J. MEMBIELA
Suite 2500
Miami, FL 33131
Telephone: 305.536.2688
Email: gmembiela@hunton.com
MAX BUTTINGER
CLIFFORD CHANCE
10 Upper Bank Street
City of London
Greater London E14 5JJ
Telephone: +44.(0)20.7006.1373
Email: max.buttinger@cliffordchance.com
Appearing on behalf of the witness:

JAMES DRAKE QC
7KBW BARRISTERS
7 King's Bench Walk
Temple, London EC4Y 7DS
Telephone: +44.(0)20.7910.8300
Email: jdrake@7kbw.co.uk
MONICA P. FOLCH
SPEARS & IMES
51 Madison Avenue
New York, NY 10010
Telephone: 212.897.4482
Email: mfolch@spearsimes.com
DAVID SPEARS
SPEARS & IMES
51 Madison Avenue
New York, NY 10010
Telephone: 212.213.6991
Email: dspears@spearsimes.com
THE EXAMINER:
MR. ALLEN DYER
4 Pump Court
Temple, London EC4Y 7AN
Telephone: +44.(0)20.7842.5555
Email: adyer@4pumpcourt.com
THE VIDEO OPERATOR:

MR. PHILLIP HILL
Video Operator
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WITNESS INDEX
Witness
Page
Hugh Burnaby-Atkins (continued). . . . . . . . . . 297
Re-examination by Mr. Bleichmar (continued). . . 297
2 (Pages 293 to 296)

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PROCEEDINGS
(3:42 p.m.)
(Pages 1-291 and 302-305 of this deposition
is contained in a separate transcript.)
MR. HUGH BURNABY-ATKINS (continued)
RE-EXAMINATION BY MR. BLEICHMAR CONTINUED:
BY MR. BLEICHMAR:
Q. Did you meet with Mr. Danon in preparation
for your testimony?
A. Yes, I did.
Q. And when did you meet with him?
MR. DRAKE: No.
THE EXAMINER: Well -MR. DRAKE: Sorry, I thought you were
entitling -- I though you were allowing him to ask one
question, who he met with.
THE EXAMINER: Well, I'm going to direct that
he answer that question, when did he meet.
THE WITNESS: Yesterday and on Monday.
BY MR. BLEICHMAR:
Q. For how long did you meet with Mr. Danon?
A. A -- an hour or two on Monday and then for
substantially all of yesterday.
Q. When you say "substantially all",
apparently how many hours?
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CORRECTIONS PAGE
Line No
Description
Page No
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A. When did we start? Eight to ten hours.

Q. This is for the purposes of the
U.S. privilege. To the extent your counsel asserted
there's a common interest privilege, are you going to
assert that there is a common interest privilege here?
MR. DRAKE: Yes, he is, and he's going to do
it through me, which I have done.
THE EXAMINER: Mr. Drake is in custody, in
charge, of the assertion of privilege.
BY MR. BLEICHMAR:
Q. Do you understand to have the same
interests as the defendants?
MR. DRAKE: No, you're not entitled to ask
these questions.
BY MR. BLEICHMAR:
Q. Do you understand to have the same
interests as the defendants?
THE EXAMINER: No, Mr. Drake asserts the
privilege. The legal basis of it will have to be in a
document that I send to the Senior Master. I don't
expect the witness to be dealing with the niceties of
the law on privilege.
(3:44 p.m.)
(The remainder of this deposition
is contained in a separate transcript.)
Page 300
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DEPONENT'S DECLARATION
I,
, hereby declare under
penalty of perjury under the laws of the United States
and the State of New York that I have read the foregoing
transcript and identify it as my own and approve same as
a true and correct transcript save and except for
changes and/or corrections, if any, as indicated by me
on the CORRECTIONS page hereof.
,
Date
,
City
,
State
Signed:
3 (Pages 297 to 300)

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Page 301
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REPORTER'S CERTIFICATE
I, Judith White, of Merrill Legal Solutions
Pty Limited, do hereby certify that the foregoing
testimony was recorded by me stenographically and
thereafter transcribed by me, and that the foregoing
transcript constitutes a full, true and accurate record
of said examination of and testimony given by said
witness, and of all other proceedings had during the
taking of said deposition, and of the whole thereof, to
the best of my ability.
I further certify that I am not a relative,
employee or counsel of any of the parties of the within
cause, nor am I an employee or relative of any counsel
for the parties, nor am I in any way interested in the
outcome of the within cause.
Signed _______________________ Dated ________
(Judith White)
4 (Page 301)
1-800-325-3376


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In The Matter Of:

CIVIL ACTION NO:

CONFIDENTIAL VIDEOTAPED DEPOSITION OF

Merrill Corporation - New York

Appearing on behalf of the Plaintiffs:

MR. ALLEN DYER

THE VIDEO OPERATOR:

Appearing on behalf of the witness:

Appearing on behalf the Defendants:

MR. PHILLIP HILL

Merrill Corporation - New York

Claire Thew to Hugh Burnaby-Atkins,

dated May 27, 2005, with attachment,

headed "Madoff. Conversation w/

Rafael Mayer", Bates stamped

Norman Chait and David Kim to

"Marketing Force", dated

December 9, 1998, Bates stamped

"Due Diligence Update", from "DK",

dated December 7, 1999, Bates stamped

"SNS Partners Inc.", dated

September 19, 2001, Bates stamped

headed "Optimal Strategic U.S.

Equity", dated August 2003,

Greenwich Group. July 13, 2004",

Bates stamped OPTIMAL-001263099-3110

Merrill Corporation - New York

first page being from

copied to others, dated March 29, 2006,

Merrill Corporation - New York

October 27, 2007, Bates stamped

with the email at the top of the first

Bates stamped OPTIMAL-000213101-3102

Merrill Corporation - New York

London law firm Richard Slade and Company for the

MR. DANON: Sam Danon from Hunton &

from Hunton & Williams on behalf of the

MS. FOLCH: Monica Folch from the law

firm of Spears & Imes, counsel for the witness,

MR. SPEARS: David Spears, law firm of

MR. HUGH BURNABY-ATKINS,

having been duly sworn,

Clifford Chance on behalf of the defendants.

THE EXAMINER: Your full name and your

17C Curzon Street, London.

Banco Santander SA is a Spanish company.

Merrill Corporation - New York

but you had responsibilities with respect to

for her professional work, she reported to

Q. What were Mr. Clark's

allowed clients to get exposure to just that one

Merrill Corporation - New York

recollection. The documents are what they are.

connection with SUS?

Merrill Corporation - New York

Q. You mentioned that Jonathan Clark

that his responsibilities in relation to SUS went

You say, "We took a greater level of care

A. -- in that due diligence is

Merrill Corporation - New York

consider full due diligence?

but it's due diligence in relation to SUS that you

Q. So you don't know them?