Friday, 25 July 2014
Last updated 52 min ago
Mar 24 2010 | 9:47am ET
Things have gone from bad to worse for accused hedge fund fraudster Dennis Hagemann.
The founder of Raleigh, N.C.-based hedge fund Yellowstone Partners saw the number of criminal counts against him increase 18-fold. Hagemann, who was arrested earlier this month on a pair of securities fraud charges and one of obtaining property by false pretense, now faces 54 fraud counts.
Hagemann, who had been free on $250,000 bond, was again arrested yesterday and was being held under a $1 million secured bond.
The new charges are the result of the continuing investigation, North Carolina Secretary of State Elaine Marshall said.
According to prosecutors, his Yellowstone Partners hedge fund was nothing more than a Ponzi scheme that netted some $700,000 from at least nine investors. Hagemann allegedly told clients Yellowstone invested in currencies, producing gains of 100% to 300%. But he actually pocketed the money, prosecutors said.
“Our investigators have continued to develop this case as more information from more victims comes in,” Marshall said. “We believe Mr. Hagemann used foreign currency trading as his sales pitch, but then used investors’ money to pay other investors in what essentially became a Ponzi scheme.”
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…