New York (HedgeCo.Net) – Hedge fund manager and adviser Berton Hochfeld was sentenced this week to two years in prison for defrauding investors out of more than $1 million. Hochfeld pled guilty in January to securities fraud and wires fraud in connection with his hedge fund management.
The SEC in 2012 froze the assets of two of Hochfeld’s hedge funds, Hochfeld Capital and Heppelwhite. The SEC’s action charged Hochfeld and his firm with securities fraud for misappropriating assets and making material misstatements to Heppelwhite Fund investors.
The SEC says that since at least April 2011, Hochfeld misappropriated assets from the Heppelwhite Fund, a hedge fund with approximately 25 investors and at least $6 million in assets. The SEC alleges that Hochfeld misappropriated approximately $1.3 million from the Fund, some of which he used to pay for a collection of valuable antiques he purchased. Hochfeld and Hochfeld Capital made material misstatements to Fund investors, including providing them with periodic statements that overstated the value of their investments, and failing to disclose that Hochfeld is subject to the 2006 SEC Order that bars him from associating with any broker, dealer, or investment adviser.
“I have betrayed my friends, my investors, and the principles I have tried to adhere to for my working life,” Hochfeld said at the sentencing.
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