Several Spanish banks said on December 15 they could lose millions of Euro to the suspected scam committed by the Wall Street broker Madoff Securities, though analysts described the fall-out as minor in Spain. Experts said that Madoff’s suspected 36 billion Euro fraud was set to hit fortunes large and small, worldwide. However, Miguel Angel Fernandez Ordonez, the governor of the Bank of Spain, said that “We are talking about 36 billion Euro. It is a ridiculous sum when one compares it with losses caused by non-fraudulent acvtivities.” US investigators, however, said the losses may be as much as 50 billion Euro or more.

The country’s second-biggest bank BBVA said it might have lost up to 300 million Euro (USD 400 million) by creating financial products linked with Madoff for other financial institutions and institutional investors. Sources of the savings bank Caja Madrid said it had 2.3 million Euro “indirectly” exposed through products related with Madoff. Spain’s top bank Santander earlier said its high-risk Optimal hedge fund unit had an exposure of 2.3 billion Euro to the US broker.

Fewer than 1,000 wealthy clients were exposed, with institutional and international private banking clients accounting for 2.01 billion of the money. Santander said it had also invested 17 million Euro of its own funds in Madoff. Santander said it could not cover the losses of its clients, given that Madoff had been supervised by the US authorities. “Santander is not responsible for frauds committed by third parties,” a bank source said.

BBVA was studying possible measures in defence of its interests, the bank told the stock market watchdog CNMV. The shock waves were reverberating worldwide as international charities, pension funds and banks, many of them European, were gradually disclosing how much they might have lost as a result of the Madoff fraud.

The now-arrested former Nasdaq stock market chairman stands accused of running a pyramid type Ponzi scheme, paying abnormally high returns to investors out of the money paid in by subsequent investors, rather than real profit. Nonetheless, financial analyst Angel Martinez-Aldama was cited by Deutsche Presse-Agentur (dpa) as having observed that the collapse of the bigger Lehmann Brothers only had a minor impact in Spain, which meant that the fall-out from the Madoff affair would be even less significant.