Tuesday, 23 September 2014
Last updated 1 hour ago
Aug 25 2011 | 12:55am ET
The founder of hedge fund Lake Shore Asset Management yesterday pleaded guilty to running a $292 million fraud.
Philip Baker, who was indicted in 2009, entered his plea on one count of wire fraud. Prosecutors said they would seek 20 years in prison when Baker is sentenced on Nov. 17.
Baker had originally faced dozens of counts of fraud, embezzlement, contempt and obstruction of justice charges. But prosecutors agreed to drop the latter two to win his extradition from Germany last year.
Regulators pulled the plug on Chicago-based Lake Shore in 2007, accusing it of improperly charging incentive fees and hiding almost $40 million in losses from investors. According to the Commodity Futures Trading Commission, the hedge fund sent phony account statements claiming substantial profits.
Baker himself stole some $33 million from investors for his own purposes, prosecutor Clifford Histed told U.S. District Judge John Darrah in Chicago.
"That's it in a nutshell," Histed said.
"Do you disagree?" Darrah asked Baker, who replied, "No, your honor."
In addition to the decades in prison, Baker is liable for $154 million in restitution and may be deported to his native Canada after completing his sentence.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitich, CIO of Petty Endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
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…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.