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Madoff's fall claims more than money

Financier Rene-Thierry Magon de la Villehuchet became caught up in what is thought to be a $50-billion scheme.

GUY GURNEY | Sipa Press

Financier Rene-Thierry Magon de la Villehuchet became caught up in what is thought to be a $50-billion scheme.

NEW YORK — The fraud may not have been the work of Rene-Thierry Magon de La Villehuchet, but it came on his watch. For a man with a deep sense of rectitude, that was shame enough.

Friends and colleagues tried to console the fund manager, the scion of French aristocracy who despaired after losing more than $1-billion of his wealthy clients' money in the Ponzi scheme allegedly run by Wall Street wizard Bernard Madoff.

"Listen, people make mistakes," Leon Cooperman, founder of hedge fund Omega Advisors, said he told de La Villehuchet in a telephone conversation Monday. "You're not at fault and you have to pick yourself up from this."

But when a security guard opened the door to de La Villehuchet's office at Access International Advisors the following morning, he found the businessman dead at his desk, both of his wrists slashed. A box cutter and a bottle of sleeping pills lay nearby. Police say it was a suicide.

The bloody scene marked a grisly turn in the Madoff scandal in which money managers and investors were ensnared in an alleged $50-billion Ponzi scheme. De la Villehuchet is believed to have lost about $1.4-billion.

No suicide note was found, said NYPD spokesman Paul Browne.

The suicide came as the number of Madoff victims grew. New York University said in a lawsuit filed Tuesday that it believes it lost $24-million in the scheme through an investment with money manager J. Ezra Merkin.

De la Villehuchet, 65, was an esteemed financier who tapped his upper-crust European connections to attract clients. It was not immediately clear how he knew Madoff or who his clients were.

He grew increasingly subdued after the Madoff scandal broke, drawing suspicion among janitors at his office Monday night when he demanded that they be out of there by 7 p.m.

A partner in the firm asked a security guard later in the evening to check and see if de la Villehuchet was still there, but the door was locked, police Commissioner Raymond Kelly said.

When a guard came into the 22nd-story office suite the next morning, less than 13 hours later, the Frenchman was dead, Browne said.

His death came as swindled investors began looking for ways to recoup their losses. Funds that lost big to Madoff are also facing investor lawsuits and backlash for failing to properly vet Madoff and overlooking red flags that could have steered them away. It's not immediately known what kind of scrutiny de la Villehuchet was facing over his losses.

De la Villehuchet (pronounced veel-ou-SHAY) comes from rich French lineage, with the Magon part of his name referring to one of France's most powerful families. The Magon name is even listed on the Arc de Triomphe in Paris, a monument commissioned by Napoleon in 1806.

"He's irreproachable," said Bill Rapavy, who was Access International's chief operating officer before founding his own firm in 2007.

De la Villehuchet's firm enlisted intermediaries with links to wealthy Europeans to garner investors. Among them was Philippe Junot, a French businessman and friend who is the former husband of Princess Caroline of Monaco, and Prince Michel of Yugoslavia.

De la Villehuchet, the former chairman and chief executive of Credit Lyonnais Securities USA, was also known as a keen sailor who regularly participated in regattas and was a member of the New York Yacht Club.

He lived in an affluent suburb in Westchester County with his wife, Claudine. They have no children. There was no answer Tuesday at the two-story house. Phone calls to the home and de la Villehuchet's office went unanswered.

Madoff's fall claims more than money 12/24/08 [Last modified: Monday, November 7, 2011 3:44pm]
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