Saturday, 1 November 2014
Last updated 15 hours ago
Nov 18 2011 | 10:17am ET
A Florida man has been accused of using a phony hedge fund to lure clients into investing $12.6 million by promising access to highly-sought-after initial public offerings.
John Mattera was arrested yesterday at his home in Fort Lauderdale, Fla. According to prosecutors and the Securities and Exchange Commission, he promised investors that he'd put their money into escrow accounts pending the promised IPOs, for companies such as Facebook and Groupon Inc. But the complaint alleges Mattera's Praetorian Global Fund had none of the promised access, and that he instead spent almost $6 million of investor cash on a luxurious lifestyle, his taxes and to settle a lawsuit.
Mattera was charged with securities fraud, wire fraud and money laundering, in addition to an SEC lawsuit, which also covers several Mattera associates. He faces up to 20 years in prison if convicted.
"As the complaint describes, Mattera told elaborate lies about stock he did not own and about how he would keep investors' money safe," Preet Bharara, the U.S. Attorney in New York, said. "Instead, Mattera took the investors' money to fund his own extravagant lifestyle."
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 McKitish of Peddie School's 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…
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