Friday, 25 July 2014
Last updated 17 hours ago
Jun 1 2009 | 9:37am ET
While the court-appointed receiver in the Bernard Madoff case has resorted to suing investors to recoup the Madoff Ponzi scheme’s phony profits, Burton Wiand, the receiver in the Arthur Nadel hedge fund fraud case, is finding a measure of success by simply asking.
Last week, Wiand announced that three more investors in Nadel’s hedge funds have agreed to return some $250,000 in money they withdrew from their accounts. All told, the receiver has won agreements totaling almost $735,000, money which will be pooled for return to victims of Nadel’s alleged fraud.
Nadel is accused of defrauding investors in his six hedge funds of about $168 million. According to prosecutors, he claimed the funds were worth more than $300 million when, in fact, their accounts held less than $125,000. Wiand has said Nadel paid out about $53 million in “fictitious profits” as part of a Ponzi scheme; he has asked 84 investors to return those “profits,” threatening legal action if they do not.
Those investors who agree to do so must pay 90% of the money they received.
Nadel remains jailed in New York, where he has been charged with 15 counts of securities, wire and mail fraud. In April, in a hand-written response to Securities and Exchange Commission civil charges against him, he denied running a Ponzi scheme.
The SEC complaint “sets forth no exact specific period of time during which the alleged wrongdoing affected all of the hedge funds, and is therefore vague, indefinite and misleading, rendering it impossible to admit or deny the allegations with any reasonable assurance,” Nadel wrote in the seven-page missive.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…