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A hedge fund is a pooled investment fund that trades in relatively liquid assets and is able to make extensive use of more complex trading, portfolio-construction and risk management techniques in an attempt to improve performance, such as short selling, leverage, and derivatives. Financial regulators generally restrict hedge fund marketing to institutional investors, high net worth individuals and others who are considered sufficiently sophisticated.
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Michael Eugene Kelly was a dual citizen of the U.S. and Mexico who operated a number of fraudulent resort enterprises and the Avanti Motor Corporation. In 2007, with 23 others, he was accused by the FBI and the United States Attorney's Office of operating an enormous Ponzi scheme that defrauded over a thousand elderly and senior citizens of their retirement money. It was later disclosed that 7,000 victims from throughout the U.S. lost more than $342 million.
Samuel Israel III is an American-born former hedge fund manager for the Bayou Hedge Fund Group, which he founded in 1996.
Thomas Joseph Petters is a former American businessman and chairman and CEO of Petters Group Worldwide, a company which stole over 2 billion dollars in a Ponzi scheme. He was convicted of massive business fraud in 2009 and is now imprisoned at the United States Penitentiary, Leavenworth. Amid mounting criminal investigations, Petters resigned as his company's CEO on September 29, 2008. He was convicted of numerous federal crimes for operating Petters Group Worldwide as a $3.65 billion Ponzi scheme and received a 50-year federal sentence.
Bernard Lawrence Madoff was an American fraudster and financier who ran the largest Ponzi scheme in history, worth about $64.8 billion. He was at one time chairman of the NASDAQ stock exchange. He advanced the proliferation of electronic trading platforms and the concept of payment for order flow, which has been described as a "legal kickback".
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Christodora House is a historic building located at 143 Avenue B in the East Village/Alphabet City neighborhoods of Manhattan, New York City. It was designed by architect Henry C. Pelton in the American Perpendicular Style and constructed in 1928 as a settlement house for low-income and immigrant residents, providing food, shelter, and educational and health services.
Participants in the Madoff investment scandal included employees of Bernard Madoff's investment firm with specific knowledge of the Ponzi scheme, a three-person accounting firm that assembled his reports, and a network of feeder funds that invested their clients' money with Madoff while collecting significant fees. Madoff avoided most direct financial scrutiny by accepting investments only through these feeder funds, while obtaining false auditing statements for his firm. The liquidation trustee of Madoff's firm has implicated managers of the feeder funds for ignoring signs of Madoff's deception. Although Madoff claimed to have executed the scheme alone, subsequent investigation has shown that he was assisted by a small group of close associates, as well as the feeders' self-interested indifference to the source of his investment returns.
The K1 fund was a British Virgin Islands based hedge fund, initially marketed to and invested in by mainly German-based private investors, and latterly a series of global banks. With an estimated size of $378million/£249million and $1Bn under management, it collapsed in 2008. It is estimated by administrators Grant Thornton that liquidated funds able to be returned to investors are zero. It is suspected by German regulators BaFin to be a ponzi scheme.
Brian Kim is an American former hedge fund manager. He founded the now-defunct Liquid Capital Management LLC, which focused on futures trading.
References
- ↑ Kolker, Robert (October 23, 2006). "Take the Hedge-Fund Money and Run". New York Magazine . Retrieved March 14, 2009.
- ↑ Frank, Robert (March 13, 2009). "From Ponzi to Madoff". The Wall Street Journal . Retrieved March 13, 2009.
- ↑ Grohmann, Karolos (September 20, 2007). "Former US hedge fund manager re-arrested in Greece". Reuters . Archived from the original on June 5, 2011. Retrieved March 14, 2009.