Hedge Fund Manager Stands Trial

Jun 12 2013 | 9:52am ET

Accused hedge fund fraudster Michael Balboa has gone on trial in New York.

Balboa, who was based in London, faces conspiracy, securities fraud, wire fraud and investment advisors fraud. According to prosecutors, Balboa invested in illiquid bonds, some in Nigeria and Uruguay, which he and two brokers then inflated in value. Those bogus values were then hidden from Millennium Global Investments' independent auditor and trumpeted to Millennium's clients in monthly newsletters. The fund, which claimed to manage US$844 million, collapsed in 2008; Balboa was paid 40% of the fees the fund earned, which amounted to some US$6.5 million.

The two brokers were not charged criminally, although one, Gilles De Charsonville, was sued by the Securities and Exchange Commission.

Millennium Global liquidated Balboa's fund during the financial crisis, costing investors some $1 billion.

Balboa faces up to 20 years in prison if convicted of securities fraud.


In Depth

Creating An Offshore Hedge Fund Dream Team: The Seven Key Players

Jun 26 2015 | 6:47am ET

If you want to set up an offshore hedge fund, like any great team, you’re only...

Lifestyle

Hedgies Set to Compete in Wall Street Decathlon

Jun 8 2015 | 12:37am ET

The Wall Street Decathlon — a 10-event physical challenge that will crown “Wall...

Guest Contributor

6 Essential Principles To Balance Your Investment Risk

Jun 26 2015 | 10:07am ET

In this article, financial expert Greg Silberman explores how to hedge a private...

 

Editor's Note