Tuesday, 24 May 2016
Last updated 19 hours ago
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.