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SEC uncovers Ponzi Scheme through fictitious hedge fund at frat house in Georgia

Wednesday, June 05, 2019

B. G., Opalesque Geneva:

A recent college graduate at the University of Georgia has been charged by the Securities and Exchange Commission (SEC) with orchestrating a Ponzi scheme through a fictitious hedge fund over the last year. He has testified and agreed to have his assets frozen. However, the SEC is still trying to identify all the victims.

Syed Arham Arbab, 22, conducted the fraud from a fraternity house near the University of Georgia campus in Athens, Georgia, says the SEC. He allegedly offered investments in a purported hedge fund called "Artis Proficio Capital," which he claimed had generated returns of as much as 56% in the prior year and for which investor funds were guaranteed up to $15,000.

Arbab also allegedly sold "bond agreements" which promised investors the return of their money along with a fixed rate of return. At least eight college students, recent graduates, or their family members invested more than $269,000 in these investments.

As money was raised, Arbab allegedly placed substantial portions of investor funds in his personal bank and brokerage accounts, which he used for his own benefit, including trips to Las Vegas, shopping, travel, and entertainment.

Arbab also allegedly used parts of the money to pay earlier investors who had asked for their money back, the hallmark of a Ponzi scheme. Arbab even instructed some new investors to send their money - unwitt......................

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