The first instance court dismissed all claims brought by the investors on 9 April, stating that custodians are only liable in cases of wilful misconduct or gross negligence.

The claimants sought legal action in 2010 after Banco Patagonia acted on its clients' behalf investing in a fund that failed as a result of the multi-billion dollar fraud committed by US businessman Bernard Madoff.

Ferrere associate Soledad Díaz says the court’s decision clarifies the legal standard in Uruguay with regard to Madoff’s fraud and the wider 2008 financial crisis in concluding that the plaintiffs, as private banking clients, were bound by enforceable clauses in the general terms and conditions acknowledging the risks associated to their investment, meaning Patagonia is not liable.