Hedge Fund Fraudster Turns On Alleged Co-Conspirators

Mar 31 2011 | 2:27am ET

One of three alleged Michigan hedge fund fraudsters has pleaded guilty and turned state’s evidence against his former business partners.

Anthony Rinkus admitted to ripping off investors in the Atlas Fund of $920,000. The money raised from investors—with Rinkus and his alleged co-conspirators promising big short-term returns from investing in distressed, cash-strapped companies—instead went to pay personal expenses, as well as to Ponzi scheme payments to older investors. None of the money raised was legitimately invested, prosecutors say.

“At the time that James Wiederhold, Anthony Rinkus and Joseph Angioi were pitching the Atlas Fund, Wiederhold was fending off collection efforts by creditors from a prior hard-money lending scheme,” Assistant U.S. Attorney Matthew Borgula said. “Wiederhold owed hundreds of thousands of dollars to former investors, who like the investors in the Atlas Fund, were led to believe by Wiederhold that he would invest their money in hard-money lending, or other investments. As with the Atlas Fund, Wiederhold never invested any of their money in any legitimate investment.

Rinkus pleaded guilty to wire fraud. He faces up to 20 years in prison when he is sentenced in June.


In Depth

Royalties: The Alternative Assets of the Music Industry

Jul 8 2016 | 7:01pm ET

Recent market volatility has investors seeking greater insight into alternative...

Lifestyle

Vortic: Making Great American Watches Again

Jul 25 2016 | 6:29pm ET

If you are compelled by stories of entrepreneurial vision & drive, or simply...

Guest Contributor

MPI: Like Stellar Returns? Better Understand the Risks First

Jul 22 2016 | 8:44pm ET

When the press reports extraordinarily strong relative or risk-adjusted returns...