A Melville man has been charged with running a phony hedge fund that cheated one client out of at least $150,000, according to officials.
Michael Molitor, 41, pleaded not guilty to a charge of fraud yesterday in U.S. District Court in Central Islip in connection with the operation of his Columbia U.S. Growth Fund in Melville.
The client who lost $150,000 was promised returns of 1 percent to 2 percent a month, according to court documents.
Molitor actually used much of that money for personal expenses, including lease payments for a Ferrari, a Porsche and a BMW, the documents said.
The client was not identified.
Molitor’s attorney, Peter Panaro of Massapequa, said “hedge funds are dependent on the market,” and Columbia’s clients lost money because the market dropped, not because of any illegal scheme. Assistant U.S. Attorney Lara Treinis Gatz declined comment.
