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New York (HedgeCo.net) – John Henry, perhaps best known as principal owner of the Boston Red Sox, has announced the firings of roughly one quarter of the staff at his Boca Raton, FL based investment company, John W. Henry & Co. According to the Boston Globe, the layoffs included a cross-section of workers because the firm, as Henry stated, “has been overstaffed for some time relative to its size.”
The firm, which manages or co-manages seven different futures or commodities-themed hedge funds, manages $188 million, not to mention an additional $200 million it co-manages with other firms. The investment manager, whose clients include the institutional likes of retirement plans, insurers, and the high net worth, has seen its assets under management fall from as high as $2.5 billion in 2004.
Henry’s funds, which boast relatively loose liquidity terms, suffered heavy redemptions dating back to 2008. Specifically, last fall many institutional investors were unable to withdraw their funds from less-liquid private equity and hedge fund investments which featured lengthy lockup provisions. As a result, many took advantage of their relatively easy access to Henry’s funds, withdrawing considerable sums and dramatically shrinking the firm’s assets under management.
In 2008, Henry’s firm performed impressively, with its larger funds posting returns from 40 to 90 percent. In 2009, however, those same funds were down between 6 and 21 percent between Jan. 1 and Oct. 31.
Dave Reynolds
Contributing Writer, HedgeCo.net
news@hedgeco.net
New York (HedgeCo.Net) – Nicholas Cosmo, head of New York-based Agape World Inc., has been arrested for allegedly running a $400 million Ponzi scheme. His company, which marketed commercial bridge loans, was not registered with the U.S. Securities and Exchange Commission.
“Some of the early investors made money but as this scheme started to crumble, the later investors did not see a penny,” said one law enforcement official, referring to the classic Ponzi scheme, where new money coming in is used to pay off earlier investors.
Agape World Inc. had bragged to clients that they posted consistent returns of around 14 percent. Had investors performed a due diligence on Cosmo, they would’ve found that he was convicted in 1999 of fraud and sentenced to 21 months in prison.
Agape World Inc. was essentially aiming to be an asset based lender. They supposedly provided project loans on construction, acquisition loans and provided financing for unfinished properties.
The trouble in the markets lately has highlighted the immense presence of Ponzi schemes all around the country. Even after the $50 billion Madoff debacle, a handful of Ponzi schemes and fraudsters have floated to the surface. Arthur Nadel of Sarasota, Florida, disappeared along with his client’s $350 million in cash. Shortly after, Michael Riolo of Boca Raton was targeted, accused of bilking $50 billion out of investors.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
New York (HedgeCo.Net) – Investors in South Florida are fearing the worst, with all eyes turned to Michael Riolo, a Boca Raton resident who may have bilked over $50 million out of investors.
Riolo regularly distributed performance reports to his investors showing admirable returns. Now, three investors are claiming that it was all a sham. Donald Gory, Anthony Leonardo and Nicholas Gory of Broward County have filed a suit against Riolo, claiming he stole more than $1 million from them.
According to the suit, Riolo allegedly conducted a “Madoff-like Ponzi scheme” through his two companies, LaSalle International Clearing Corp. and Sterling Wentworth Currency Group. The investors said they were recently informed that the firms had become insolvent. They are asking the judge to freeze his assets and ban him from transferring any funds.
It seems that wealthy Florida residents have been hit hard by financial scams in recent months. Bernard Madoff, the infamous Ponzi-schemer who lost $50 billion of investor’s money, was a part-time Palm Beach resident who garnered the trust and money of many elite Floridians.
Money manager Arthur Nadel of Sarasota is still missing, along with $350 million, after being exposed as a fraud in what authorities are now dubbing the “mini-Madoff.”
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
