SEC Raps Hedge Fund Manager For Inflating Assets

Jan 5 2012 | 12:46pm ET

The Securities and Exchange Commission has sued a Chicago hedge fund manager for allegedly lying to her investors and to the regulator itself.

According to the SEC's complaint, Krista Lynn Ward "grossly exaggerated" the assets under management of two funds of hedge funds she ran. Those overstatements ranged from telling one asset manager that its assets had grown from $27 million to $200 million between 1999 and 2006—Ward's Calhoun Asset Management was actually managing $3 million in 2006, the SEC said—to telling the SEC in Calhoun's February 2009 adviser registration form that Calhoun had almost $80 million in assets when it actually had only $7 million.

Ward, who launched the two funds of funds in 2006, also told potential clients she was an experienced hedge fund manager "despite having no experience in portfolio management" whatsoever, according to the SEC.

"We believe it's important to take action when an adviser is inflating assets under management in an attempt to attain clients," John Sikora of the SEC's Chicago office said.


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

Lifestyle

Hedgies, Economists and Musicians Mingle At Milkin Mixers In Hamptons

Aug 25 2014 | 6:00am ET

Leave it to Michael Milken to bring some gravitas and sweat to the Hamptons -- along...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.