AlphaMetrix Clients Could Be Out $13 Million

Dec 4 2013 | 12:34pm ET

Hedge funds could be on the hook for $13 million owed them or their clients by AlphaMetrix Group.

The Commodity Futures Trading Commission monitor overseeing the hedge-fund services firm said that hedge funds and commodity trading advisers are owed between $7 million and $10 million in fees by AlphaMetrix. In addition, their investor clients are owed $3 million in rebates.

Last month, the CFTC accused AlphaMetrix of misappropriating $2.8 million in fee rebates. The allegation came after AlphaMetrix warned clients in October that it had "encountered significant cash-flow issues," followed by a decision to begin closing investment pools.

Still, the monitor, Deborah Thorne, said she believes 95% of investor funds should be returned by Dec. 20, although that does not include the rebates. She warned that AlphaMetrix has "spent most or all" of that $13 million.

Thorne added "that additional investigation into the activities of current and former management should be conducted to determine whether there are causes of action to be pursued to bring in additional funds to compensate the losses of the rebate claims and possibly the claims of the CTAs."

In Depth

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


U.S. Trust's Beard: The Rapid Growth of the Art Lending Industry

Oct 7 2016 | 10:55pm ET

Alternative investment managers have emerged as some of the most significant art...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...