The US Securities and Exchange Commission has announced that it has obtained permanent injunctions over two former hedge fund managers who presided over the collapse of the Bayou hedge fund last year leaving investors out of pocket to the tune of millions of dollars.
On April 19, 2006, in a civil action previously filed by the Securities and Exchange Commission (Commission), Judge Colleen McMahon of the United States District Court for the Southern District of New York entered judgments permanently restraining and enjoining Samuel Israel III and Daniel E. Marino, principals of a group of Stamford, Connecticut hedge funds known as Bayou Funds, from future violations of the general antifraud provisions of the federal securities laws.
Israel and Marino consented to the permanent injunctions without admitting or denying the allegations in the Commission's complaint.
The SEC's complaint alleges that from 1996 through 2005, during which time investors deposited over $450 million into the Funds, Israel and Marino knowingly misappropriated, dissipated, and lost tens of millions of dollars of their investors' capital.
The complaint further alleges that Israel and Marino defrauded their investors by, among other misconduct: fabricating financial statements, account statements, and performance summaries to show false profitability; creating a fictitious accounting firm in 1998 to issue "independent" audit reports that validated the Funds' purported profitability, when in fact the Funds had been highly unprofitable throughout the relevant period.
Under the terms of the judgments entered against Israel and Marino, the Commission may in the future seek disgorgement of ill-gotten gains, prejudgment interest, and civil money penalties from Israel and Marino.
In related proceedings, the SEC on Tuesday issued an order permanently barring Israel and Marino from associating with any broker, dealer, or investment adviser.
.
Network Tweets
Network BlogsContent
provided by
|
Archive | Resources | Partners | Site Map | Links | Newsletter Archive | Contact | RSS Feeds | About | Syndication | Advertising & Marketing | Recruitment | Terms & Conditions | Privacy & Cookies
Copyright © 2012 - All Rights Reserved - Tax-News.com
IMPORTANT NOTICE: Tax-News.com has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments.
Write a comment