Monday, 24 November 2014
Last updated 2 hours ago
Aug 23 2013 | 5:02am ET
Hedge fund manager Chetan Kapur has been freed from prison, after prosecutors dropped the most serious charges against him.
Kapur was sentenced to time served this week, a month after pleading guilty to one count of failing to keep adequate records. The ThinkStrategy Capital Management founder had been facing a whole host of more serious charges for fraud, but the government abandoned them after determining they didn’t have enough evidence to support them.
Kapur spent just over a year in prison awaiting trial before he was released on bail last month—rather than the 100 years he faced if convicted of the original charges. He had been accused of misleading investors in his once-$520 million fund of hedge funds firm, and of having due-diligence standards so lax that his hedge fund invested in three separate Ponzi schemes: Bayou Group, Arthur Nadel and Grant Grieve.
In December, Kapur was fined $5 million by the Securities and Exchange Commission.
At Monday’s hearing, Kapur said that he was “very upset” about the losses ThinkStrategy suffered, but maintained that he had gone into his own pocket to protect clients from losses.
“ThinkStrategy and I did not abandon investors, which we were legally entitled to do,” Kapur said. “Investors benefited at the expense of ThinkStrategy and me.”
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