Accused Hedge Fund Fraudster Frozen

Nov 28 2012 | 12:59am ET

A federal judge has frozen the assets of a hedge fund and its manager after the Securities and Exchange Commission accused them of misappropriating assets and misleading investors.

The SEC sued Berton Hochfeld and his Hochfeld Capital earlier this month. The regulator said that Hochfeld had stolen some $1.3 million of the at least $6 million he raised, using some of it to buy a collection of antiques. Hochfeld, who was arrested on Nov. 9 on fraud charges, allegedly kept clients of his Heppelwhite Fund in the dark with a series of bogus account statements.

Hochfeld also allegedly violated a 2006 SEC ban from the industry—a ban that he allegedly neglected to tell Heppelwhite investors about.

A federal judge entered consent judgments against Hochfeld, his firm and his fund, froze the assets of all three and appointed a receiver.

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