Then, HU caused the CLO Trust to enter into fake loan transactions with the Panamanian Shell Entities. Then, HU caused the CLO Trust to enter into fake loan transactions with the Panamanian Shell Entities. The co-founder of an investment advisory firm based in New York was sentenced Wednesday to 13 months behind bars for stealing more than $100 million from clients in a Ponzi-like scheme. NY Fund Manager Gets 13 Months for $100 Million Ponzi Fraud (1) Attorneys Drew Skinner, Negar Tekeei, and Alex Rossmiller are in charge of the prosecution. Pursuant to Fed. VIII. Elon Musk's go-to Lawyer. If you would like to change your settings or withdraw consent at any time, the link to do so is in our privacy policy accessible from our home page.. The former managing partner and chief investment officer of a New York-based investment advisory firm has been sentenced to 12 years in prison for his role in defrauding clients and investors in a more than $120 million Ponzi scheme, according to the U.S. Attorney for the Southern District of New York. IIGs trade finance loans were purportedly secured by collateral, such as the underlying traded goods, assets held by the borrowers, or expected payments by third parties. The Court also announced that it would impose restitution to victims and forfeiture of the proceeds of the offenses, with the amounts to be determined at a later date. On March 23, 2023, the U.S. District Court for the Southern District of New York entered a final consent judgment against Martin Silver, the co-founder of International Investment Group (IIG), a formerly registered investment adviser, enjoining him from violating the antifraud provisions of the federal securities laws. In 2021, while silver made a slightly higher high at $30.35, the trading band was narrower as the years low was at $21.41. IIG also advised the Venezuela Recovery Fund (VRF), a fund that managed the remaining assets of a failed Venezuelan bank (VRF, together with TOF, GTFF, and STFF, the IIG Funds). According to the information filed against Hu by the Justice Department in 2020, as well as statements made and documents filed inU.S. District Court for the Southern District of New York, Hu and co-conspirator Martin Silver, who founded IIG together in 1994, provided investment management and advisory services through the firm, including for three private funds that it operated: IIG Trade Opportunities Fund, IIG Global Trade Finance Fund, and IIG Structured Trade Finance Fund. David Hu, who had co-founded SEC-registered, Manhattan-based International Investment Group, pleaded guilty in January 2021 to investment advisor fraud, securities fraud and wire fraud offenses. According to the Information and based on statements made and documents filed in federal court in this case: HU and co-conspirator MARTIN SILVER founded IIG in 1994. MARTIN SILVER, 63, of New Jersey, pled guilty to one count of conspiracy to commit investment adviser fraud, securities fraud, and wire fraud, which carries a maximum sentence of five years in prison; one count of securities fraud, which carries a maximum sentence of 20 years in prison, and one count of wire fraud, which carries a maximum sentence of 20 years in prison. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia. Both Hu and Silver have also reached settlements with the U.S. Securities and Exchange Commission in parallel sentenced The court said beginning in 2007, Hu and others engaged in various deceptive acts to cover up losses in its Trade Opportunities Fund (TOF). (212) 637-2600, Human Trafficking & Child Sexual Exploitation, Department of Justice Harassment Prevention Resource. Hus lies caused millions of dollars of losses, he added. This case is being handled by the Offices Securities and Commodities Fraud Task Force. In addition to the prison sentence, Hu was ordered to serve three years of supervised release. Martin She strictly adheres to the ethical standards in journalism. 1602-1605, 1749-53, 1783-86. May 3, 2016 3:38pm. Advisory Firm Gets 12 Years For $120M Ponzi Scheme. This case is being handled by the Offices Securities and Commodities Fraud Task Force. He admitted to operating a Ponzi-like scheme to steal money from IIG investment advisory fund clients and investors for ten years. Silver begged for mercy ahead of his sentencing in a letter to the judge, saying he was "broken-hearted" he had caused people to lose faith in government. In March 2018, IIG reported to the SEC that it had approximately $373 million in assets under management. The $8.94 trading range was less than half the previous year. From approximately 2007 to 2019, HU conspired to defraud investors in IIG-managed funds by: (i) overvaluing distressed loans held by the IIG Funds, (ii) falsifying paperwork to create a series of fake loans that were classified, fraudulently, as positively performing loans, and to otherwise hide losses, (iii) selling overvalued and fake loans to a collateralized loan obligation trust and new private funds established and advised by IIG, and (iv) using the proceeds from those fraudulent sales to generate liquidity required to pay off earlier investors in a Ponzi-like manner. My Office remains committed to policing investment advisers who seek to take advantage of their clients for personal and professional gain.. For her, integrity is everything. IIG purported to value the trade finance loans in the IIG Funds on a regular basis. IIGs principal investment advisory strategy, including with respect to the IIG Funds, was investing in trade finance loans that it also originated. Using a collateralized loan obligation trust (the CLO Trust) to create liquidity through investments in fraudulent loans. SILVER pled guilty to investment adviser fraud, securities fraud, and wire fraud offenses in April 2021 and his sentencing is pending. From approximately 2007 to 2019, HU conspired to defraud investors in IIG-managed funds by: (i) overvaluing distressed loans held by the IIG Funds, (ii) falsifying paperwork to create a series of fake loans that were classified, fraudulently, as positively performing loans, and to otherwise hide losses, (iii) selling overvalued and fake loans to a collateralized loan obligation trust and new private funds established and advised by IIG, and (iv) using the proceeds from those fraudulent sales to generate liquidity required to pay off earlier investors in a Ponzi-like manner. This case is being handled by the Offices Securities and Commodities Fraud Task Force. Land The Job You Want Using the 'Rule of 5', Are You Best Suited to Big Law . She previously worked as research analyst and editor at Lombardi Financial and has written for various websites including The Motley Fool, ValueWalk, IcannWiki and was a news writer/radio program producer at Nation Broadcasting Corporation. Sentencing to the Starting Point: The Alberta Debate IIGs principal investment advisory strategy, including with respect to the IIG Funds, was investing in trade finance loans that it also originated. From approximately 2007 to 2019, SILVER conspired to defraud investors in IIG-managed funds by: (i) overvaluing distressed loans held by the IIG Funds, (ii) falsifying paperwork to create a series of fake loans that were classified, fraudulently, as positively performing loans, and to otherwise hide losses, (iii) selling overvalued and fake loans to a collateralized loan obligation trust and new private funds established and advised by IIG, and (iv) using the proceeds from those fraudulent sales to generate liquidity required to pay off earlier investors in a Ponzi-like manner.

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