Fairfield's letter to Madoff investors

FAIRFIELD SENTRY LIMITED

Romasco Place, Wickhams Cay 1

Road Town, Tortola

British Virgin Islands, VG 1110

December 22, 2008


Dear Shareholder,

Suspension of the Calculation of Net Asset Value

Reference is made to the extraordinary events of last week regarding Bernard L. Madoff Investments Securities LLC ("Madoff"). As you are most likely aware, on December 11, 2008 Bernard Madoff was arrested and charged with securities fraud for operating in essence a giant Ponzi scheme. It has been alleged that Madoff's fraud involved a loss in both cash and securities of possibly US$50 billion.

As you will have read in the press, Fairfield Sentry Limited (the "Company") was significantly exposed to Madoff. At this point in time the value of the Company's investment in Madoff is not certain. There may be residual assets in Madoff to be distributed or, alternatively, there may be no assets.

With the view to acting in the best interests (of ourselves) of the Company and all of its shareholders and creditors, the Board of Directors of the Company (the "Board") has suspended the calculation of net asset value with a corresponding suspension of redemptions and subscriptions pursuant to Article 11(4) of the Articles of the Association of the Company, due to the fact that the Board determined (i) that circumstances exist as a result of which in their opinion it is not reasonably practicable for the Company to dispose of investments or that any such disposal would be materially prejudicial to shareholders, (ii) that a breakdown has occurred in the means normally employed in ascertaining the value of investments of the Company, (iii) that the value of the investments of the Company cannot reasonably or fairly be ascertained and (iv) that the Company is unable to repatriate funds required for the purpose of making payments due on redemption of shares. As such, pursuant to the powers contained in the Articles of Association of the Company, the Board has suspended the determination of the net asset value.

As a result of such suspension, all subscriptions (People still putting money in here? Boy is that rich) into and redemptions from the Company have been suspended. With respect to redemption requests received for the November 30, 2008 dealing date, the payment of these proceeds of redemption have been similarly suspended pursuant to the powers contained in the Articles of Association of the Company.

The Company has retained counsel in the British Virgin Islands and the United States to represent its interests. These counsel will advise as to what action should be taken to ensure the Company's interests in the remaining assets of Madoff are represented, to ensure an orderly running of the affairs of the Company and to ensure that all shareholders and creditors are treated equitably and fairly. In this regard and as advised by counsel, we are not able to respond to requests for information by individual shareholders at this time. Rather, information will be provided to all shareholders to ensure that no one shareholder is at an advantage.

We note that the manager to the Company, Fairfield Greenwich (Bermuda) Limited, has waived all fees until further notice. (Now that we've lost all your money we aren't charging you!)

We will endeavour to keep you advised of developments with respect to the Company.


Yours faithfully,

The Board of Directors

(italics mine)