Hedge Funds

Hedge Fund Fraud Lawyers

Published on: January 8, 2024 | by Shepherd Smith Edwards & Kantas, LLP

Am I The Victim of Hedge Fund Fraud?

Our Hedge Fund Fraud Lawyers Represent Investors of All Experience Levels

If your broker unsuitably recommended that you invest in a hedge fund and you suffered serious losses, contact Shepherd Smith Edwards and Kantas (investorlawyers.com) today. These private investment pools of participants’ money ideally should only be marketed to sophisticated investors with a lot of money. High-risk and often lacking transparency, hedge funds are generally not appropriate for retail investors, inexperienced investors, and conservative retirees. Yet, because there are investment companies that invest in hedge funds—less experienced investors can become exposed to them.

SSEK Investigates Claims That Charles Schwab Recommended Advisory Firms Market Vida Longevity Fund To Customers

Published on: July 19, 2021 | by Shepherd Smith Edwards & Kantas, LLP

Charles Schwab Should Have Known RIAs Were Promoting the Fund

Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com) is looking into losses suffered by Vida Longevity Fund, LP investors. Many investors were recommended this open-ended hedge fund by Creative Planning, Pin Oak Investment Advisors, or other registered investment advisors (RIAs) that Charles Schwab Corporation referred them to.

While it is not uncommon for Schwab to recommend RIAs to clients, the broker-dealer either knew or should have known that these firms were marketing the Fund to customers.

Bank Losses From Archegos Collapse Exceed $10B After UBS and Morgan Stanley Report $861M and $911M Losses, Respectively

Published on: May 5, 2021 | by Shepherd Smith Edwards & Kantas, LLP

More Fallout From Hedge Fund’s Sell-Off

A month after Archegos Capital Management (Archegos), a hedge fund and the family office of Bill Hwang, liquidated more than $30 Billion in equities when banks ordered it to post more collateral after borrowing on margin, news about the fallout continues.

UBS Group has finally disclosed that it lost $861 Million as a result of exposure to Archegos. Morgan Stanley also recently announced that it sustained $644 Million in losses from a “credit event” and $267 Million in related trading involving Archegos.

Brokers Who Sold Vida Longevity Fund Investments May Have Made Misrepresentations and Omissions

Published on: October 12, 2020 | by Shepherd Smith Edwards & Kantas, LLP

Investors Lose Money After VLF Hedge Fund Loses Value

If you are someone who has suffered significant losses from investing in the Vida Longevity Fund, LP (VLF), you may have a reason for pursuing an investment fraud case against the broker or financial advisor that sold you this investment.

Unfortunately, this open-ended hedge fund, which is a Delaware limited partnership that invests primarily in longevity-contingent assets, including senior life settlements, has experienced a substantial decline in value. The market turbulence created by COVID-19 earlier this year didn’t help.

Recent Ponzi Fraud Allegedly Targeted College Grads

Published on: June 7, 2019 | by Shepherd Smith Edwards & Kantas, LLP

The US Securities and Exchange Commission (SEC) is accusing a recent college graduate of running a Ponzi fraud that targeted young investors, including college students and other recent graduates. The regulator announced its emergency action against Syed Arham Arbab, Artis Proficio Capital Management, LLC, and Artis Proficio Capital Investments, LLC this week. It wants an asset freeze, emergency relief, civil penalties, and the repayment of allegedly ill-gotten earnings along with prejudgment interest.

At least eight college students, recent college graduates, or their relatives invested over $269K in the alleged hedge fund fraud. According to the regulator’s complaint, Arbab ran his scam out of a fraternity house close to the University of Georgia campus. He is a recent alumni and is accused of using his college connections to perpetuate his alleged scam.

According to the SEC’s complaint, Arbab sold investments in Artis Proficio Capital, a supposed hedge fund, that he touted as making up to 56% returns the year before, and he supposedly guaranteed up to $15K of investor money. Investors who purchased bond agreements were told that their money would be returned with a fixed return rate.

Recent Fraud Cases Targeted Hedge Funds, Senior Investors, and Israeli-Americans

Published on: April 25, 2019 | by Shepherd Smith Edwards & Kantas, LLP

SEC Accuses Investment Adviser of Misappropriating Funds from Hedge Funds

The US Securities and Exchange Commission (SEC) has secured an emergency asset freeze, as well as a temporary restraining order, to stop an ongoing allegedly fraudulent securities offering that was purportedly conducted to conceal the misappropriation of about $570K from hedge fund clients. The regulator contends that investment adviser Eric D. Lyons and his investment advisory businesses, Synchronicity Capital GP, LLC, Synchronicity Capital Group, and Synchronicity Group, LLC, used the money to pay for Lyons’ personal spending, including Broadway shows, concert tickets, sailing expenses, rent, and other costs.

According to the regulator’s complaint, the allegedly fraudulent securities offering involved securing about $300K from one investor who thought other large investors would be potentially involved and that there was a $100M business valuation. The SEC alleges that, in total, the Synchronicity entities and Lyons raised about $700K through both the misappropriation of funds and the allegedly fraudulent offering.

Investor Fraud Crimes: Ex-Hedge Fund Manager and Investment Advisor Sentenced

Published on: April 10, 2019 | by Shepherd Smith Edwards & Kantas, LLP

Raymond Montoya, a former Boston hedge fund manager, is sentenced to 14 years in prison. According to the US Attorney’s Office for the District of Massachusetts, Montoya, 70, pleaded guilty to multiple counts of wire fraud, mail fraud, and charging an unlawful monetary transaction after the government accused him of deceiving investors of his RMA Strategy Opportunity Fund and costing them more than $30M.

The ex-hedge fund manager and owner of Research Magnate Advisors admitted to stealing money to support his luxury lifestyle. Some of his victims were his own friends and relatives.

Investors in the RMA Strategy Opportunity Fund were under the impression that the fund held more money than it actually did. Meanwhile, Montoya falsely touted possession of proprietary software that could help make wise investment choices involving bonds and stocks and would supposedly lead to returns. The investor fraud went on from at least 2009 to about mid-2017, which is when Massachusetts Secretary of the Commonwealth William Galvin brought a civil fraud case against Montoya.

Hedge Funds That Own Puerto Rico General Obligation Bonds Continue to Fight for Repayment

Published on: March 5, 2019 | by Shepherd Smith Edwards & Kantas, LLP

According to The Wall Street Journal, three hedge funds that own Puerto Rico general obligation (GO) bonds have set up their own committee in an effort to get paid back the money they are owed. Court records indicate that GoldenTree Asset Management, Monarch Alternative Capital, and Whitebox Advisers, which collectively own about $800 million of GO debt, want to distinguish themselves from the other bondholders whose claims have recently come under question.

Their committee formation comes just weeks after Puerto Rico’s fiscal oversight board,known as the Financial Oversight and Management Board (the “Board”), raised questions about whether $6 billion in general obligations are valid. The bonds at issue were sold after March 2012, including $3.5 billion of high yield general obligations that the island sold in 2014. Monarch, Whitebox, and GoldenTree purchased their GO bonds prior to March 2012.

Puerto Rico Continues to Owe Over $70 billion in Debt.

Statim Holdings Is Accused of Defrauding Private Fund Arjun and Its Investors

Published on: February 11, 2019 | by Shepherd Smith Edwards & Kantas, LLP

The US Securities and Exchange Commission has filed civil charges against Statim Holdings, Inc. and its owner Atlanta investment adviser, Joseph A. Meyer. The regulator is accusing them of defrauding the private fund Arjun L.P., which they managed, and its investors.

Arjun, set up by Meyer in 2007, is a pooled investment vehicle. Its records indicate that its assets under management have never gone over $45M. By the middle of 2009, about 40 investors had invested in the fund, which had lost almost 36% of its value as a result of trading losses.

However, Meyer reported high return rates for Arjun, which caused investors to jump on board. In 2015, Bloomberg News and other services even ranked Arjun as among the best performing hedge funds. Yet it was also at around this time that then-Georgia Secretary of State Brian Kemp, who is now governor, notified Bloomberg that his office was looking into “irregularities” involving Arjun and its owner. The following year, Bloomberg raised questions about Arjun’s performance. In 2017, the SEC opened its own probe into the hedge fund firm and its owner.

Investor Fraud: Boston Hedge Fund Manager Pleads Guilty in Ponzi Scam Case, Ex-State Street Executive is Sentenced to 18 Months, and Willow Creek Fund Manger Must Forfeit $13M

Published on: October 29, 2018 | by Shepherd Smith Edwards & Kantas, LLP

Man Who Ran RMA Strategic Opportunity Fund Ponzi Scam Pleads Guilty

Raymond K. Montoya, a Boston hedge fund manager, has pleaded guilty to operating a multi-billion dollar Ponzi scam involving the RMA Strategic Opportunity Fund, LLC. Montoya pleaded guilty to multiple counts of mail fraud, wire fraud, and conducting an unlawful monetary transaction.

Montoya was charged and arrested last year. His victims included relatives, friends, and people he knew. They invested millions of dollar, including their savings and retirement funds.