New York (HedgeCo.Net) – A former Florida hedge fund manager is being held without bail in a West Palm Beach prison after prosecutors convinced the judge he is a flight risk. 

Attorneys for Won-Sok Lee were seeking a continuance for his arraignment on Friday so that he could find a local lawyer.  

Lee and his company, The KL Group, were accused of swindling over $200 million out of investors through their hedge funds back in 2006.  He was arrested in February after trying to board a plane from Seoul to Argentina after spending three years on the run.  

Lee and his brothers, who are currently serving lengthy prison terms, ran hedge funds out of locations in Florida and Nevada from 2000 to 2005.

Lee is facing dozens of charges, including conspiracy, money laundering, and mail and wire fraud.  His next hearing is scheduled for April 17.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

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Tags: accredited-investors, arraignment, conspiracy, continuance, dozens, flight risk, hedge-fund-manager, hedgeco, kl group, lengthy-prison-terms, mail, money-laundering, palm-beach, prosecutors, seoul, sister-sites, sok, wire-fraud

TREND Information – Major Asia and Pacific markets traded higher Tuesday in the waning days of a dismal year, reported CNN.

In Tokyo, the Nikkei closed 1.3 percent higher during an abbreviated final trading day of 2008. Despite the positive session, the index closed with its worst-ever annual percentage fall, losing 42.1 percent.

Elsewhere across the region, the KOSPI in Seoul was up 2.3 percent in afternoon trading, while Australia’s All Ordinaries index was 1.3 percent higher. Hong Kong’s Hang Seng picked up 0.9 percent.

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Tags: asia, australia, cnn, hang seng, hong kong, kospi, nikkei, pacific markets, seoul, tokyo

Financial Times – It is becoming clear that the hedge fund universe is set to shrink. The most obvious casualties will be highly levered funds, in particular the strategies that cannot justify their fees without that level of leverage, such as a number of arbitrage strategies.

In addition, depending on what further regulation is put in place, some of the more specialist funds could find themselves at risk (for example sector funds, or short only funds). Diversification could prove to be the key to providing protection from legislative changes, and in this regard, multi-strategy funds could become a more interesting prospect as they have the ability to allocate capital away from strategies that could be adversely affected by regulatory change.

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Tags: beta, dti, fixed-income-arbitrage, investment-funds, july-1-2005, seoul, squeeze, treasury-department, tuohy