SEC charges fugitive trader for hedge fund fraud
Washington, DC - Arthur Nadel, a trader and investment adviser for six hedge funds, has been charged with fraud by the Securities and Exchange Commission (SEC). The US regulator says Nadel provided false and misleading information for dissemination to investors, overstating the value of investments in funds by approximately $300 million.
The funds in fact contained less than $1 million. The complaint also alleges Nadel, who has been missing from his Sarasota, Florida home since January 14 2009, transferred at least $1.25 million from two of the funds to two secret bank accounts under his control.
The SEC's Miami office says two firms, Scoop Capital and Scoop Management, provided investment advice to the funds involved and also engaged in fraud as a result of Nadel's actions. The SEC has frozen the defendants' assets and is appointing a receiver.
Relief defendants
The six hedge funds and two other investment management companies involved are also charged as relief defendants, as a result of the false information from Nadel that they disseminated to customers. The SEC says the firms implicated are co-operating with its investigation.
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