New York (HedgeCo.Net) – Another former hedge fund manager is being targeted by regulators for misleading clients. The SEC has charged a former portfolio manager at Oppenheimer & Co. with misleading investors about the valuation and performance of a fund consisting of other private equity funds.
“Investors deserve and the law requires honest disclosure about how their investments are valued,” said Andrew J. Ceresney, Co-Director of the SEC’s Division of Enforcement. “Williamson improperly lured investors to the private equity fund he managed by providing false and misleading information about the fund’s performance.”
The SEC said that Brian Williamson’s quarterly reports and marketing materials misstated the valuation of the Oppenheimer fund’s holdings. He also sent marketing materials reporting an internal rate of return that failed to deduct fees and expenses. As a result, the fund’s reported performance as measured by its internal rate of return – a key indicator of the fund’s performance – was significantly enhanced.
Earlier this year, Oppenheimer agreed to pay $2.8 million in a settlement of related charges.
Williamson marketed Oppenheimer Global Resource Private Equity Fund I, L.P. to pensions, foundations, endowments, and high net worth individuals and families. Williamson also modified the Oppenheimer fund’s marketing materials in October 2009 by increasing the reported value of the fund’s largest investment – Cartesian Investors-A LLC – from $6 million to approximately $9 million, the SEC says.
Alex Akesson
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