Most hedge fund managers wouldn't cheer a Securities and Exchange Commission fraud lawsuit, but NIR Group's Corey Ribotsky is doing just that.
Ribotsky, who was accused this week of misappropriating more than $1 million to pay for luxury cars and other lavish personal expenses, was "vindicated" by the SEC's lawsuit, NIR said in a statement. "There are no claims that NIR fraudulently valued the assets of the funds or that NIR took fees that it was not entitled to take," two of the key allegations made by the investors whose own lawsuits against the Roslyn, N.Y.-based hedge fund precipitated the SEC investigation.
"After years of investigating claims of Ponzi scheming and fraudulent valuation, primarily lodged by two former disgruntled employees who had been terminated for improper conduct, the NIR group and its managing partner, Corey Ribotsky have been vindicated in part by the fact that the Securities and Exchange Commission's long-running investigation failed to make a case in support of these specious claims."
NIR did not explicitly deny the SEC allegations, noting only that they focus on "approximately $1 million against the backdrop of a fund that had in excess of $800 million in total assets in addition to tens of millions of dollars paid to NIR." NIR said it would defend itself in court.
"I think the complaint appears to be a stretch in an attempt to justify approximately two years of time and resources poured into the investigation," Brad Gerstman, Ribotsky's lawyer, said.