New York (HedgeCo.net) – Hedge fund founder James Nicholson pleaded guilty to stealing up to $140 million in a Ponzi type scheme. He was sentenced to 40 years in prison on Friday by U.S. District Judge Richard Sullivan.
The New Jersey hedge fund founder admitted that he lied to investors about his AUM and returns. Bloomberg reports that according to the prosecution, Nicholson told investors he had $900 million under management, when in reality he only controlled between $50 million to $60 million.
Reuters said that among the victims were members of Nicholson’s extended family, as well as a schoolteacher. Nicholson pleaded guilty to securities fraud, investment adviser fraud and wire fraud charges.
Alex Akesson
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