Saturday, 28 March 2015
Last updated 20 hours ago
Apr 28 2009 | 2:02am ET
Accused hedge fund fraudster James Nicholson pleaded not guilty yesterday to charges that he ripped investors off to the tune of $160 million.
Nicholson entered his plea in New York federal court. He was arrested in February after his alleged scheme collapsed under the weight of accelerating redemption requests, and was charged last week with securities and investment adviser fraud.
The founder of Pearl River, N.Y.-based Westgate Capital Management will be back in court in June. He faces up to 65 years in prison and a $6 million fine if convicted of the charges.
The Securities and Exchange Commission has also sued Nicholson and Westgate, alleging they misrepresented the value of the hedge funds, and used sales materials boasting of an allegedly false record of investment success.
According to the SEC complaint, at least one Westgate fund claimed positive returns in 98 of 99 consecutive months. Nicholson allegedly created a fictitious accounting firm and providing some of his investors with bogus audited financial statements. He apparently concocted this imposter firm under the name of an actual accountant while using his own telephone number and driver's license to set up a “virtual office.”
By late 2008, the Nicholson’s funds had sustained such losses that he could no longer honor redemption requests and hid his losses from investors with bogus sales brochures. He also closed one fund that was heavily invested in Lehman Brothers and folded its assets into another fund. In addition, he issued bad checks to some investors seeking to cash out, and ultimately suspended all investor redemptions due to what he called investors' “irrational behavior.”
Mar 9 2015 | 6:35am ET
As 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…
Mar 20 2015 | 12:45pm ET
StreetWise Partners, a non-profit organization that works with low-income individuals to help them overcome employment barriers, raised over $275,000 at the 2015 Raising the Ante Charity Poker Tournament and Casino Event last Wednesday evening at Capitale. Here are some photos from the event. Read more…