Private-Equity Manager Penn Charged With Stealing From Investors

Feb 12 2014 | 12:14pm ET

Private-equity manager Lawrence Penn has been arrested for allegedly defrauding investors of $9.3 million.

Penn was indicted on Monday and turned himself in. He pleaded not guilty to counts of grand larceny, money laundering and falsifying business records. Penn's alleged accomplice, Altura Ewers, has also been charged. Ewers was arrested Sunday in San Francisco and will be extradited to New York.

The criminal charges come less than two weeks after Penn, who runs Camelot Acquisitions Secondary Opportunity Management, was sued on similar allegations by the Securities and Exchange Commission. Prosecutors say Penn paid out bogus fees to a shell company set up by Ewers, who then moved the money into accounts and companies controlled by Penn.

Penn allegedly spent the loot on a pair of apartments, jewelry and a luxury car—as well as for more prosaic items, such as credit-card bills and office space.

"Stealing from investors not only damages the market, it hurts individuals," Manhattan District Attorney Cyrus Vance said. "The defendants in this case are charged with defrauding the fund for millions while continuing to solicit unwitting investors."

Penn's bail has been set at $2.5 million.


In Depth

Don’t Overlook These 6 Hybrid Cloud Concerns

Sep 14 2017 | 6:27pm ET

Cloud-based technology solutions have made tremendous inroads into the alternative...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Cash: An Asset In Adolescence

Aug 31 2017 | 3:34pm ET

If the investment industry has a rebellious teenager in the house today, that teenager...

 

From the current issue of