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

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


Hedge Funds Swarm Into Palm Beach

Oct 27 2016 | 2:32pm ET

As the first flakes of snow fall on New York's northern suburbs, Dan Weil of South...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...