Financial institution obtains appellate victory in putative class action claims relating to alleged Ponzi scheme
Clients Financial institution
Jones Day secured an appellate victory for a financial institution facing a putative class action asserting claims arising from an alleged Ponzi scheme. The plaintiffs made deposits in accounts held by our client for purposes of investing in a hedge fund that operated the alleged Ponzi scheme. After the scheme was uncovered, the plaintiffs asserted claims against our client for negligence, aiding and abetting breach of a fiduciary duty, violation of the Illinois Fiduciary Obligations Act ("FOA"), and unjust enrichment. After the trial court granted a motion to dismiss all claims with prejudice, plaintiff appealed. In a unanimous opinion, the Illinois Appellate Court, First District, affirmed the dismissal of all of plaintiffs' claims against our client. The Appellate Court's order establishes precedent under the FOA that provides important protection to financial institutions facing similar claims.