Wed, Aug 16, 2017
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   |   
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. Other Voices: Crisis risk offset; about time?[more]

    This article was authored by Russell Barlow, global head of hedge fund solutions at London-based Aberdeen Asset Management. Like the ubiquitous force of gravity, when financial markets rise they must fall. The quest

  2. Comment: "Long-Term Investing": What managing drawdown risk can do to your long-term returns[more]

    Matthias Knab, Opalesque: Real Investment Advice writes on Harvest Exchange: Last week, I was having lunch with a prospective portfolio management client discussing the curre

  3. Jasper Capital International joins Hedge Fund Standards Board[more]

    Komfie Manalo, Opalesque Asia: Diversified and systematic investment firm Jasper Capital International has become the second China-based signatory to the Hedge Fund Standards Board (HFSB), an organization that brings hedge fund managers and investors together to set standards for the hedge fund i

  4. Opalesque Exclusive: Albright Capital puts a value lens on emerging markets[more]

    Bailey McCann, Opalesque New York: Over the past decade, investors have steadily increased investments in emerging markets private funds. Allocations to the cohort have increased from $93 billion in December 2006 to $564 billion in September 2016, according to data from research firm Preqin. Howe

  5. Investing - Hedge-fund honchos including David Tepper are loading up on Alibaba, Billionaire hedge fund manager Stanley Druckenmiller is betting big on the Chinese consumer, Big-name U.S. hedge funds shed healthcare stocks during the rally in second-quarter, U.S. hedge funds bearish on FAANG stocks in second-quarter, Hedge fund titan Viking Global made a $680 million bet on scandal-plagued Wells Fargo[more]

    Hedge-fund honchos including David Tepper are loading up on Alibaba From CNBC.com: David Tepper's Appaloosa Management and three other he ge funds took new stakes in Chinese e-commerce giant Alibaba in the second quarter, according to the latest quarterly filings. Appaloosa disclos