Thursday, 18 September 2014
Last updated 11 hours ago
Dec 9 2008 | 2:00am ET
Two former executives of a collapsed Canadian hedge fund have asked a judge to toss the regulatory case against them, arguing that the system is against them.
John Xanthoudakis, the former CEO of Norshield Asset Management, and Dale Smith, the former president of the Montréal-based hedge fund, have asked the Ontario Divisional Court to stay the Ontario Securities Commission’s case against them. According to Xanthoudakis and Smith, recent comments by the OSC’s chairman prove that they cannot get a fair hearing because the regulator is biased against them.
The OSC has accused Xanthoudakis and Smith of misleading both investors and the regulator itself about the hedge fund, which collapsed amid a scandal in 2005. It is also pursuing a case against Peter Kafalas, a former director, but he is not party to Xanthoudakis and Smith’s motion.
But the two men say that the OSC as a whole is against them, citing a recent television interview with David Wilson, its chairman.
“About 99% of the time, they’re good people that aren’t fraudulent people,” Wilson said of those seeking approval of investment prospectuses. “Norshield was run by people who were not honest. That’s what happened to Norshield.”
Xanthoudakis and Smith say those comments prove that they cannot receive a fair hearing before the OSC.
The regulator, as one might expect, disagrees, saying “there is not a scintilla of evidence” that an OSC hearing panel can handle the case, noting that Wilson has no role in it.
“Corporate taint has been repeatedly rejected by the courts as a valid theory of bias,” the commission said. “Bias is an attitude of mind unique to the individual.”
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.