Sunday, 3 May 2015
Last updated 1 day ago
Oct 4 2011 | 3:05am ET
A Miami hedge fund is throwing in the towel after an arbitration panel found that it made misleading statements to a fund of hedge funds.
Quantek Asset Management said its founder, Javier Guerra, has resigned as manager of its Quantek Opportunity Fund. The once-$1 billion is in liquidation—a process that will now have to be completed by another firm.
Guerra's exit follows Quantek's defeat at the arbitration table by Aris Capital's Multi-Strategy Fund. The arbitrators found that Guerra and Quantek had fraudulently induced Aris to invest with it by making false and misleading statements. The panel awarded Aris about $1 million in damages.
Quantek and Guerra said they "strongly disagree with the arbitration panel's findings and unequivocally assert that they never made any false or misleading statements to Aris or any other investor in the funds." But, they told clients in a letter last week, "as a result of the finding," the directors of the fund decided to end "Guerra's continued service as a director of the fund."
The panel "ignored critical evidence which clearly undermined the truth of Aris' claims," Guerra told Forbes. "At no time did I mislead Aris. The fact is Aris has exploited an administrative error by an operations executive to recover $1 million from a one-time $1 billion fund."
Aris, headed by Jason Papastavrou, has been fighting Quantek since the latter froze redemptions in 2008. The following year, Aris sued Quantek, accusing Guerra of using its fund as a "personal 'piggy bank,'" another allegation Guerra denies.
Meanwhile, the Quantek fund's board hopes to name one of its biggest investors, Weston Capital Asset Management, as the fund's interim manager. The fund has already returned about $260 million to investors.
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…