Wed, Dec 2, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

SEC charges Yorkville Advisors with overvaluing AuM, exaggerating returns

Thursday, October 18, 2012

Benedicte Gravrand, Opalesque Geneva – New Jersey-based Yorkville Advisors LLC, a former $1 billion hedge fund advisory firm, and founder and president Mark Angelo and chief financial officer Edward Schinik were charged today by the U.S. Securities and Exchange Commission (SEC) with scheming to overvalue assets under management (AuM) and exaggerate their hedge funds’ reported returns.

Angelo, 40 and Schinik, 47, allegedly did so – at least since 2008 – to hide losses and increase the fees collected from investors. Apparently, they also misrepresented the safety and liquidity of the investments made by the hedge funds. The hedge funds in questions were YA Global Investments (U.S.) LP (launched in 2005) and YA Offshore Global Investments Ltd (launched in 2001). Angelo and Schinik enticed more than $280m in investments from pension funds and funds of funds. This enabled Yorkville to charge the funds at least $10m in excess fees based on the inflated values of Yorkville’s AuM.

Aberrational Performance Inquiry According to the SEC’s release , this is the agency’s seventh case arising from its own Aberrational Performance Inquiry, an initiative by the Enforcement Division’s Asset Management Unit that uses proprietary risk analytics to identify hedge funds with suspicious returns. Performance that is flagged as inconsistent with a fund’s investment strategy or other benchmarks forms a basi......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. David Einhorn's hedge fund plunged 5.2% in November, set for 2015 loss[more]

    From David Einhorn’s main hedge fund at Greenlight Capital fell 5.2 percent in November and is poised for only its second losing year in almost two decades. The losses bring the fund’s yearly drop to almost 21 percent, according to an e-mail sent to clients that was obtained by Bloomb

  2. Other Voices: Hedge fund marketing and the selling cycle[more]

    By Bruce Frumerman. How long is the selling cycle now? That’s a question my financial communications and sales marketing consulting firm has been asked on a regular basis by hedge fund firm owners and sales people, ever since we opened the doors to our firm in 1987 pre-crash. Wa

  3. People - Solus Alternative Asset Management adds chief strategist from BTIG[more]

    From Daniel Greenhaus joined hedge fund manager Solus Alternative Asset Management as managing director and chief strategist. He will work closely with Chris Bondy, Solus’ chief economist, managing director and executive vice president, said Chris Pucillo, CEO and chief investmen

  4. Commodities - Stung by oil, distressed-debt traders see worst losses since '08[more]

    From It’s mid-November, but for investors who trade in the debt of distressed companies, the year’s already done -- and they lost. Hedge funds that specialize in the debt are grappling with their worst declines in seven years. Funds managed by Knighthead Capital Management, Candlewood

  5. Regulatory - Major changes in partnership audit procedures contained in 2015 Budget Act[more]

    Contained in the Bipartisan Budget Act of 2015, signed by President Obama on November 2, is a rather complex provision that materially changes how partnerships are audited. Generally effective for tax years beginning after December 31, 2017, the so-called “TEFRA” and “Electing Large Partnership” rul