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Former hedge fund managers agree to plead guilty to fraud

(Reuters) – Two former hedge fund managers who boasted Ivy League credentials and invested some of their clients’ money with swindlers Bernard Madoff and Thomas Petters, agreed to plead guilty to criminal charges that they lied about their investment record, the U.S. attorney in Boston said on Tuesday.

Gabriel Bitran, 69, a former professor at the Massachusetts Institute of Technology and associate dean at its business school, and his son Marco Bitran, 39, will be sentenced to serve at least two years but no more than five years in prison if the court accepts the pleas, U.S. Attorney Carmen Ortiz said in a statement.

No dates have been set for when the men will make their guilty pleas or when they will be sentenced.

The men founded hedge fund GMB Capital Management in 2005 and raised more than $500 million from wealthy investors who wanted a piece of the MIT’s professor’s exclusive computer models, which the pair falsely said had never suffered a down year and delivered double-digit returns ranging between 16 percent and 23 percent.

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