Bloomberg – Hedge fund manager Mark Bloom pleaded guilty to U.S. charges that he stole at least $20 million from clients and lied to them, and that he helped sell illegal tax shelters while working earlier at BDO Seidman LLP.

Bloom, who lives in New York City, pleaded guilty yesterday in federal court in Manhattan to five charges including securities fraud. He admitted he stole millions from investors in North Hills Fund, an investment partnership with more than $30 million in assets that he managed. He agreed to forfeit as much as $20 million and to cooperate with prosecutors in their continuing investigation.

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Globe and Mail – When Mark Bloom was arrested last week in New York for allegedly bilking clients of North Hills Fund, the case marked a new low in the hedge fund world.

Not just because Mr. Bloom had allegedly stolen $13.2-million (U.S.) from investors, sent false financial statements and lied repeatedly about the fund’s holdings. What really galled prosecutors was that Mr. Bloom had secretly invested client money in a Canadian-based hedge fund and then bitterly complained to regulators when the fund manager was charged with stealing money from investors, sending false financial statements and lying about the fund’s holdings.

Then, when a court-appointed receiver recovered the bulk of the money Mr. Bloom had invested in the Canadian fund, he managed to divert most of the money to himself.

"This action demonstrates the length to which unscrupulous individuals will go to defraud investors," said Stephen Obie, acting director of enforcement of the Commodity Futures Trading Commission (CFTC), which filed charges against Mr. Bloom along with the U.S. Attorney’s Office in New York.

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Tags: client money, commodity futures trading commission cftc, commodity-futures-trading-commission, false financial statements, futures-trading-commission, globe and mail, investors, mark bloom, mr bloom, obie, prosecutors, regulators, stealing money, unscrupulous individuals