Ponzi Scheme Receiver Expects $350M Recovery

Dec 1 2011 | 10:23am ET

Victims of Francisco Illarramendi's Ponzi scheme could get back more than half of their money, the court-appointed receiver in the case estimates.

John Carney wrote in a court filing this week that he expects recoveries from Illarramendi's Michael Kenwood Group and Highview Point Partners hedge funds to total between $310 million and $350 million. Investors in the scam lost about $540 million, most of it invested by the pension fund of Venezuela's state-owned oil company. Carney warned that the estimates are preliminary.

Among the assets eyed by Carney are private equity, securities and cash.

Carney also asked for more money for his own firm, $2.8 million, up from the $1.6 million he sought in May. His forensic accounting firm also asked for a $2 million raise, citing nearly 10,000 hours sorting through Illarramendi's mess between April and June. For his part, Carney said he's interviewed 22 witnesses, made over 250 document requests and sifted through some 2.3 million documents.

Illarramendi pleaded guilty in March and awaits sentencing. He faces up to 70 years in prison.


In Depth

GSAM’s Papagiannis on Liquid Alternatives

May 25 2016 | 5:07pm ET

The popularity of liquid alternatives strategies has blossomed in recent years,...

Lifestyle

From Modern Trader: Stephen Curry is a Black Swan

May 18 2016 | 7:43pm ET

What do the rise of the Internet, the sinking of the Titanic, 9/11, and Stephen...

Guest Contributor

LendingClub and the Question of Internal Hedge Funds

May 19 2016 | 8:42pm ET

Peer-to-peer lending platform LendingClub Corp. has been in the news since the firm...