Tue, Oct 21, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

SEC recovers $229.4m from Ponzi schemer Francisco Illarramendi

Thursday, June 30, 2011
Opalesque industry update – On Tuesday, The Securities and Exchange Commission (SEC), the U.S. securities watchdog, revealed it had recovered some $229.4m from an offshore fund held by Francisco Illarramendi and his firm Highview Point Partners LLC, which managed three hedge funds, according to Reuters.

Illarramendi, the 42-year-old Connecticut-based hedge fund manager pleaded guilty in March to running a multiyear Ponzi scheme that defrauded investors of hundreds of millions of dollars. He pleaded guilty to five criminal counts including securities fraud, wire fraud and conspiracy to obstruct justice and defraud the SEC.

The hedge fund manager, who is also a majority owner of Michael Kenwood Group LLC, is charged with running his Ponzi scheme from 2006 until February 2011 by using money raised from new investors to repay old investors. He was also accused of providing a fake income statement that was certified by a Venezuelan accountant, that his company had $275m in assets. The assets did not exist, investigators said.

The SEC told a U.S. court that they had already received the money from Illarramendi’s offshore funds. The assets were recovered last week and will be deposited in a U.S. bank while the civil case against the accused is finalized by the court.

Last month, the 40-year-old Venezuelan accountant Juan Carlos Horna Napolitano of Pembroke Pines, Florida, who provided the spurious income statement, admitted to SEC investigators that he had obstructed the watchdog’s investigation of Illarrramendi. Napolitano pleaded guilty to one count of conspiracy to obstruct an official proceeding of the SEC before United States District Judge Stefan R Underhill in Bridgeport.

In January this year, a U.S. federal judge ordered the freezing of Illarramendi’s assets in connection with the Ponzi scheme investigation.
Komfie Manalo

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   

Banner

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. Opalesque Exclusive: What's next for trend followers?[more]

    Bailey McCann, Opalesque New York: New research out from Ibbotson touches on a key debate happening among investors and fund managers, specifically whether long term trend followers can survive in the new

  2. Commodities - Oil wreaking havoc on small-cap energy stocks sliding 36%[more]

    From Bloomberg.com: Owning almost anything in the U.S. stock market has been a losing proposition since September. Owning smaller energy companies has been a catastrophe. Hercules Offshore Inc. and Resolute Energy Corp. are among 19 oil-and-gas equities in the Russell 2000 Index that lost more than

  3. Investing - Hedge funds favor equity long/short, Strategic bond managers hedge against further high yield sell-off[more]

    Hedge funds favor equity long/short From Securitieslendingtimes.com: Equity long/short strategies will generate good returns for hedge funds in the future, according to a panel at this year’s Risk Management Association Conference on Securities Lending in Naples, Florida. Panellists Sand

  4. Legal - Ex-hedge fund analyst weeps as judge hands down 5 year sentence, Former Columbus investment manager Steven P. Moore indicted on theft charges, SEBI confirms ban for Hong Kong hedge fund, SEC announces enforcement action against compliance officer[more]

    Ex-hedge fund analyst weeps as judge hands down 5 year sentence From Hereisthecity.com: An ex-hedge fund analyst was sentenced to 5 years in prison for his role in insider-trading scheme. The New York Post reports that former hedge fund analyst Matthew Teeple was sentenced Thursday to fiv

  5. Sparx optimistic about outlook for Japan[more]

    Benedicte Gravrand, Opalesque Geneva: According to SPARX, there are causes to be optimistic about the outlook for the Japanese market and the country's economy in general. Sparx Asset Management is a Tokyo-based asset manager, part of