Canadian Hedge Fund Rapped For Trading Without A License

Apr 27 2012 | 4:31am ET

A Toronto hedge fund and its manager have settled allegations that they sought to evade Ontario's registration rules.

The Ontario Securities Commission accused Daniel Sternberg and his Parkwood GP of, not so much trading without a license, but illegally borrowing one. From 2004 through 2011, though Sternberg made all of Parkwood's investment decisions, another, registered firm, Eosphoros Asset Management was listed as the manager of the fund, the OSC alleges. And while Eosphoros collected Parkwood's management and performance fees, it handed between 85% and 95% of that money to a company owned by Sternberg, which had been hired as a consultant.

"In providing the services, Sternberg assisted [Eosphoros] in providing advisory services to and in making investment decisions for the fund, thereby engaging in the business of advising the fund with respect to investing in, buying or selling securities," the OSC alleged. What's more, even after the regulator confronted Sternberg two years ago, extracting a promise that he'd register, he didn't.

"Sternberg's activities during the post-consulting period were indistinguishable from his activities during the consulting period," the regulator said.

Eosphoros was not accused of any wrongdoing in the case.


In Depth

High Time For A Cannabis Hedge Fund?

Sep 30 2014 | 7:07am ET

Launching a hedge fund is always a gamble, but Leslie Bocskor's decision to launch...

Lifestyle

Griffin Donates $1M To Rauner's Illinois Gov. Campaign

Sep 22 2014 | 9:29am ET

Hedge fund billionaire Kenneth Griffin definitely has a dog in this fight. The Citadel...

Guest Contributor

Appraisal Ratio Key To Evaluating Hedge Funds And Other New Investments

Sep 29 2014 | 3:07pm ET

As a former finance professor Peter Hecht experiences heartburn every time he hears...

 

Videos

Editor's Note

    Must Attend Hedge Fund Charity Events For October

    Sep 30 2014 | 9:29am ET

    The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…

 

Futures Magazine

September 2014 Cover

High frequency market making

High frequency trading is not evil, it is not a conspiracy and it really is not new; it is the natural evolution of the professional trading community making markets, providing liquidity and hopefully...

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.