NYPPEX Private Equity Fund Manager Accused Of $13M Investor Fraud
Laurence G. Allen, the CEO of New York-based broker-dealer, NYPPEX Holdings LLC, is accused of defrauding investors of over $13M. New York Attorney General, Leticia James, filed a securities fraud lawsuit suing Allen, a private equity manager who is also a registered broker and a former investment advisor.
If you were one of these investors that suffered losses from working with Laurence Allen, contact Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) today.
Investors Put Money Into ACP X Fund
In a news release, Leticia James’ office said that the NYPPEX broker’s alleged fraud took place over a decade, between 2008 and 2018. The NY Attorney General contends that it involved the private equity fund ACP X, LP, which was touted as the kind of fund that would purchase interests in other private equity funds on the secondary market at a reduced rate.
The investments involved interests that came through NYPPEX and were supposed to pay investors distributions that were “prompt and consistent.”
However, when financial woes hit the broker-dealer, Laurence Allen allegedly diverted ACP X money to NYPPEX to save the broker-dealer, as well as pay himself a salary that would total about $5.7M. The NYPPEX broker is accused of misappropriating about $3.4M in carried interest and improperly using ACP X money to cover NYPPEX’s daily business costs.
In a statement, the New York Attorney General claimed that Allen used other people’s savings as “his own personal piggy bank and as a tool to prop up his failing business.” Meanwhile, Allen allegedly sought to conceal his fraud by creating fake documents related to the investments made in NYPPEX while inflating the ACP X fund’s value to investors.
Investors Fraud: No Returns and The Loss Of Their Investments
The New York Attorney General contends that Allen continues to perpetuate his investor fraud despite knowing that he is under investigation. Meanwhile, none of the investors — they collectively invested $17M — have received the complete return of capital contribution, nor have they been paid the over $10M in returns owed to them.
Allen’s BrokerCheck record notes that he’s worked 37 years in the industry. In addition to his 20 years as an NYPPEX broker, he has been a broker with Northeast Securities, Bear Sterns, and Merrill Lynch.
Investor Fraud Lawyers
If you are a victim of investment fraud, don’t blame yourself. As a consumer, you sought the best financial advice from your broker or financial advisor who then mislead you. Millions of Americans have fallen victim to instances of broker misconduct such as misrepresentation, negligence and churning.
SSEK Law Firm is offering free case evaluations to investors throughout the US that lost money while investing with Laurence Allen or any other NYPPEX broker. Contact our investor fraud lawyers today.