Accused Ponzi Schemer Bailed Out By Alleged Victims

Apr 3 2009 | 1:02am ET

The California hedge fund manager at the center of a bizarre alleged Ponzi scheme has been released on bail, thanks in part to some of his apparent victims.

Three of the 150 people that authorities say invested in Anthony Vassallo’s hedge fund have put up their homes to secure his release from jail, according to KCRA-3 television in Folsom, Calif. Last month, Vassallo was charged with fraud, money laundering and securities law violations. His former bodyguard was also arrested, accused of trying to shake down a pair of Vassallo’s investors.

Despite the fact that he’s accused of swindling them and their fellow investors, many of whom Vassallo met through his Mormon church, his sister’s mother-in-law and two of her friends, all investors in Vassallo’s Equity Investment Management and Trading, have put up the equity of their homes to secure Vassallo’s release.

According to prosecutors, Vassallo promised investors 36% returns with no risk. After his early investments produced huge lawsuits, the complaint alleges he turned Equity Investment into a Ponzi scheme in September 2007. The Securities and Exchange Commission shut the firm down last month, and froze $1.2 million of his assets.


In Depth

'Smart Beta' Funds In Regulators' Sights, Hedgies May Be Next

Mar 26 2015 | 11:11am ET

Funds that mimic strategies used by active managers for a fraction of the cost could...

Lifestyle

Study: Both Marriage and Divorce Lead to Negative Hedge Fund Performance

Mar 25 2015 | 6:51pm ET

Trouble at home leads to trouble in the market for fund managers, according to researchers...

Guest Contributor

Concerned About Your HFT Exposure? Hedge It!

Mar 26 2015 | 1:06pm ET

High-frequency trading has been a persistent storyline for several years. The trading...

 

Sponsored Content

    Mar 9 2015 | 6:35am ET

    Kelly RodriquesKelly RodriquesAs more investors look to diversify, many are beginning to use retirement funds to invest in alternative assets such as private equity and real estate. Kelly Rodriques, CEO & President of PENSCO Trust Company, explains how companies can connect with those looking to use their retirement accounts in a different way. Read more…

Editor's Note