Hedge Fund Manager Pleads Guilty To Fraud

Dec 16 2011 | 4:06am ET

His first hedge fund venture ended in bankruptcy. His second has ended with a guilty plea.

Ward Onsa yesterday admitted to running a Ponzi scheme at his New Century Hedge Fund Partners. According to prosecutors, Onsa raised more than $5 million for the vehicle, mostly from investors’ individual retirement accounts.

Onsa’s investing premise was that the Dow Jones Industrial Average would never exceed 10,748.But it did, breaking the barrier in 2006 and remaining above it for all of 2007 and most of 2008, causing huge losses. So Onsa took some $2.6 million raised from newer investors and loaned it or “returned” it to earlier investors. He also provided falsified statements and siphoned off money for himself, in part via his already defunct firm, Ward Onsa & Co., which collapsed in 2005.

Onsa faces up to 20 years in prison.

“The defendant continued to solicit investors by showing fictitious gains, both while the fund was losing money and after he had ceased to invest at all,” Janice Fedarcyk, the Federal Bureau of Investigation agent in charge of the probe, said.

“Through a web of lies and deceit, the defendant targeted those funds to line his own pockets and prop up his failed investments,” Loretta Lynch, the U.S. attorney in Brooklyn, said. “The defendant’s criminal decision to tap investors’ IRA accounts as part of his Ponzi scheme reaffirms this office’s resolve to vigorously investigate and prosecute fraud in the securities and commodities markets.”


In Depth

Fund Focus: Asian Frontier Capital Offers U.S. Investors Access To Untapped Markets

Mar 2 2015 | 6:47am ET

Hong-Kong based asset manager Asian Frontier Capital is making a capital raising...

Lifestyle

Hedge Fund Manager Out as Minnesota Wild Minority Owner

Feb 25 2015 | 2:45pm ET

New York hedge fund manager Philip Falcone is no longer a minority owner of the...

Guest Contributor

Risk Management: The Due Diligence Challenge And Branding Opportunity

Mar 2 2015 | 8:41am ET

The hedge fund firms that make it easier for prospective investors to gain comfort...

 

Editor's Note