Collapsed Hedge Fund Hit By Fraud Claims

Nov 8 2007 | 12:16pm ET

Investors in a hedge fund that went under during this summer’s market turmoil are crying foul, accusing its managers of defrauding them out of as much as $100 million.

According to an arbitration claim filed last month against Sample & Cross Capital Management, investors allege that the firm said the Vega Opportunity Fund would focus on capital preservation. Instead, it managed to lose 75% in a single day, before Sample & Cross pulled the plug on Aug. 17.

Sample & Cross, based outside Chicago, was founded by UBS veterans Matthew Sample and J. David Cross.

Andrew Stoltmann, representing some of the aggrieved investors, filed the complaint with the American Arbitration Association, accusing the firm of violating Illinois antifraud provisions.

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    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…