29-Year-Old Hedge Fund Fraudster Pleads Guilty

Sep 16 2013 | 11:10am ET

The self-proclaimed "youngest African-American hedge fund founder in history" has admitted that the title he bestowed upon himself was somewhat misleading.

Frederick Scott on Friday pleaded guilty to charges that he defrauded clients of $1.3 million, bilking them with a story of having risen from homelessness to the hedge fund world, and all before he turned 30 years old. Indeed, little if anything Scott told the victims of his ACI Capital Group was true, including claims that he managed $3.7 billion.

In reality, Scott took the money he was entrusted with and used it to finance a lavish lifestyle, prosecutors said.

Loretta Lynch, the U.S. Attorney in Brooklyn, N.Y., said that Scott "stands revealed as a common thief."

During the hearing, Scott told the presiding judge that he was a high school graduate and that he knew he was making false promises to clients. He faces as long as five years and three months in prison when he is sentenced later this year.


In Depth

Exotic Assets: Investing In Rare Violins

Jan 17 2017 | 4:43pm ET

By definition, alternative investments include exotic assets far beyond your typical...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

DarcMatter: The Top Trends in Alternative Investments for 2017

Jan 13 2017 | 8:22pm ET

The $7 trillion alternative investments industry is poised for continued growth...

 

From the current issue of

The U.S. Commodity Futures Trading Commission (CFTC) ordered The Goldman Sachs Group Inc., and Goldman, Sachs & Co. to pay a $120 million penalty for attempted manipulation and false reporting of ISDAFIX Benchmark Rates, a global benchmark for interest rate products.