Forbes – A federal judge in Florida ruled Wednesday that the head of two hedge funds deceived investors about the funds’ holdings. Elsewhere, federal regulators accused a California investment adviser of making tainted recommendations to clients.
In the Florida case, U.S. District Judge Kenneth Marra ruled that Michael Lauer, the head of Connecticut-based hedge funds Lancer Management Group and Lancer Management Group II, engaged in a fraud that cost investors about $500 million, according to the Securities and Exchange Commission.
Marra granted the SEC’s request for summary judgment against Lauer, finding that he overstated the hedge funds’ values from 1999 to 2002, manipulated the prices of seven securities that were an important part of the portfolios, and deceived investors about the funds’ holdings by providing them with fake financial statements.
