New York (HedgeCo.Net) – Hedge fund manager and former Penn State tight-end, Paul Pomfret, has been sentenced to 63 months’ imprisonment. He pleaded guilty to wire fraud in May, his Palm Beach-based hedge fund PDP Capital has been involved in several legal battles starting in 2004.
The Palm Beach Post covered the charges:
Federal prosecutors last year accused Pomfret of defrauding a South Carolina businessman of $500,000. The unnamed victim met Pomfret in the Cayman Islands in 2010 and agreed to invest in Pomfret’s hedge fund, PDP Capital Investments of Palm Beach, prosecutors said.
Pomfret, 49, issued a phony statement showing profits in the victim’s account. In fact, prosecutors said, Pomfret never invested the money but spent it himself.
The money was not invested in Pomfret’s funds but went to pay off two previous investors, the prosecution said. At that point, in fact, the fund of funds was largely shut down, and most of the money received by Pomfret was tied up in a beach house and promissory notes. All of the $500,000 investment eventually was lost.
Pomfret was ordered to pay over $1.6 million to various victims.
Palm Beach is no stranger to fraud. KL Group was one of the first big cases of hedge fund fraud in 2005, followed by the infamous Madoff Scandal of 2008, to the Palm Beach Capital debacle in 2010.
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