Hedge Fund Manager Accused Of $3.5M Fraud

Jan 19 2011 | 5:03am ET

A Chicago hedge fund manager has been arrested and charged with defrauding investors of more than $3.5 million.

According to the Federal Bureau of Investigation, James Brandolino ripped off about 48 high-net worth investors. For a time, his commodity trading made money—a lot of money. His Falcon Stock Index fund returned 15.5% from mid-2007 through July 2008. But on either side of that halcyon year for the commodity pool were only lies, according to the criminal complaint against Brandolino.

From 2003 to 2007, Brandolino lost most of the $1.5 million he raised, but sent investors bogus account statements showing steady returns, according to prosecutors. And after his year of good fortune, he abruptly closed the Falcon fund—but allegedly didn’t tell investors and didn’t return their money.

Prosecutors said Brandolino returned about $1.1 million of the money raised in the form of redemptions. The rest were split between investment losses and lavish spending on himself, including a luxury car and interest in an unbuilt condominium in Greece.

Brandolina was charged with mail fraud in Chicago federal court after turning himself in yesterday. He is being held in custody, facing up to 20 years in prison.


In Depth

Prominent Hedgie Renee Haugerud Embroiled in Ugly Child Custody Battle

Sep 10 2014 | 2:43pm ET

A high-profile hedge fund manager is caught up in a nasty child custody battle in...

Lifestyle

Full House’s Stamos To Play TV Hedge-Fund Manager

Sep 5 2014 | 4:43am ET

The life of a Connecticut hedge-fund billionaire is coming to the small screen.

Guest Contributor

The Cult of Loss Aversion: A Call to Rethink Risk in Global Macro Investing

Sep 4 2014 | 5:45am ET

In the wake of a traumatic loss, whether it is financial or personal, it is just...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

In search of the ‘new normal’ at the Fed

The Federal Reserve keeps baby-stepping toward a “normalization” of monetary policy. But just what is normal?

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.