Hicks, Accused Of Fraud, Hit With Fines

Mar 23 2012 | 12:27pm ET

Accused hedge fund fraudster Andrey Hicks was ordered to pay more than $7.5 million, three times the amount he allegedly defrauded investors.

Hicks, who was arrested in Canada last year trying to flee to Switzerland and who was indicted for wire fraud in December, was hit with a $2.5 million fine by U.S. District Judge Richard Stearns, as part of a lawsuit filed by the Securities and Exchange Commission. Hicks' hedge fund, Locust Offshore Management, was fined the same amount, and Hicks was ordered to pay $2.5 million in restitution—plus interest.

According to prosecutors, Hicks told clients that he developed Locust's algorithmic systems while studying at Harvard University, but failed to mention that he flunked out after three semesters and only barely passed the only math class he took. He also falsely claimed to have worked for Barclays and that Locust managed $1.2 billion, prosecutors say.

Hicks' largest alleged victim is Kris Humphries, who plays for basketball's New Jersey Nets, but who is perhaps best-known for his very short-lived marriage to reality television star Kim Kardashian. He allegedly lost about $617,000.

If convicted of the criminal charges, Hicks faces up to 20 years in prison.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...