New Hedge Fund Fraud from Boston Area
The FBI announced yesterday that "a Waltham man was charged today in federal court with defrauding more than fifty victims in an investment fraud scheme. The Information alleges that from approximately January, 2001 to October, 2005, Mark Conway acted as the managing partner of Groundswell Partners LLC, the General Partner and management company for Groundswell Capital LP, a quantitative systematic hedge fund doing business in Massachusetts. It is alleged that as managing partner, CONWAY made numerous misrepresentations to investors including that the hedge fund would follow a specific market timing investment strategy devised in part by Mark Conway . It is alleged that in fact, Mark Conway , the sole trader for the fund, ceased using the promised investment strategy without notice to, or the approval of, the investors. In order to hide this deviation from the promised strategy, Mark Conway created and distributed false documentation for the purpose of inducing investors to transmit additional investment monies, concealing the true status of the hedge fund account and its trading history, and causing existing investors to leave their funds under Mark Conway's management. Mark Conway received a fee for his management of the investment funds." (my emphasis)
Some quick facts: 54 investors have allegedly lost $25 million, in part because it apparently is easy to create false documentation. Do you think that if you were risking on average, $500,000.00, you might figure out whether the documentation was accurate and truthful? Or would this small detail escape your attention?
Technorati Tags: mark conway, investors, partner, fbi, investment strategy, hedge fund, investment fraud, groundswell, fraud scheme, timing investment, sole trader, false documentation, market timing, waltham
