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New York (HedgeCo.Net) – The SEC has targeted hedge funders David Myatt and William Eichengreen, both of Directors Performance Fund, with charges of fraud.
The two men allegedly took $25 million of their investment advisors money and put it into a “prime bank” scheme. This kind of scheme generally involves investors fraudulent claims that funds will be used to purchase “prime” financial instruments, usually in overseas markets, with the promise of high returns. Most of the time, neither the instruments nor the markets they supposedly trade on through special “access” even exist. In this case, Myatt and Eichengreen promised returns in excess of 10% per week with minimum risk.
Eichengreen then falsified documents pertaining to performance while lying about the fund strategy and asset allocation. The hedge fund also raked in performance fees that were based on the doctored numbers.
Investors in the fund should receive their money back, after a previous suit resulted in the court being responsible for distributing the assets back to investors. Myatt also previously pleaded guilty to an obstruction of justice charge that was brought against him in connection with this hedge fund.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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Bloomberg – Wolver Hill Japan Multi-Strategy Fund, run by Deutsche Bank AG’s former prime brokerage sales chief in Tokyo, resisted the worst month for the nation’s stocks in almost 15 years to be little changed in September.
The $11 million fund of hedge funds, which invests in 14 hedge funds with a combined $5.8 billion of assets, slipped 1.4 percent in September based on preliminary figures, said Ed Rogers, chief executive officer of Wolver Hill’s local advisory firm, Rogers Investment Advisors Y.K. The Topix index of 1,714 companies tumbled 13 percent.
Foreseeing a decline in equity prices, Wolver Hill made a shift during the past year into hedge funds that use trading- focused strategies, and away from so-called long-short funds that depend on rising and falling stock prices, Rogers said. Trading- focused funds, including so-called event-driven strategies, trade securities of companies going through events such as mergers, acquisitions and management changes.
Reuters – Hedge fund manager CQS said on Thursday it had launched a new fund that will aim to profit from the volatility that has gripped global stock markets for much of the past year.
CQS, which had $9.6 billion (5.4 billion pounds) of assets under management at the start of August, said it had launched CQS Global Volatility Fund with an initial size of US$160 million.
The fund will use futures and options to trade volatility, with a primary focus on equity market indexes and on individual equities within the world’s major stock markets.
"The Fund aims to profit from valuation anomalies in equity volatility and from dislocations in markets. CQS believes that equity market volatility provides a consistent opportunity set to capture profits for investors," CQS said in a statement.
Bloomberg – Rogers Investment Advisors Y.K., a Tokyo-based hedge fund adviser, has hired Yoshiaki Iizuka and Eric Chong as it expects to more than double assets by the year-end.
Iizuka, 52, joined Rogers Investment on Aug. 1 as a managing director and head of Japanese research in Tokyo, after his most recent stint as chief investment officer of Tokyo-based Traders Investment Management Co., now JPS Asset Management Co., Ed Rogers, chief executive officer of Rogers Investment, said in an interview in Tokyo. Iizuka was chief executive officer of American Express Financial Advisors Japan Inc., Rogers said.
Chong, 36, joined Wolver Hill Advisors in New York, the U.S. counterpart of Rogers Investment, in mid-July, as a risk manager, Rogers said. He was most recently a risk manager at Societe Generale Asset Management Inc. in New York, where he was responsible for risk evaluation and analysis for a $5 billion fund of hedge funds, according to Rogers. Prior to that, Chong was a vice president at Stamford, Connecticut-based K2 Advisors LLC, a $6 billion multi-strategy fund of hedge funds.
