Another Ponzi Scheme Bites the Dust
In more image-boosting news for the hedge fund industry, the SEC announced yesterday that it was bring charges of fraud against a Valencia, California fund manager for misappropriating funds and misleading investors. The 34-year-old principal of CMG-Capital Management, Keith G. Gilabert allegedly lost more than half of the $14.1 million he had raised from 38 investors while pocketing another $1.7 million himself. Not surprisingly, another $4.6 million was used to keep the ponzi scheme going. Gilabert also failed to mention to investors that the firm’s investment adviser registration had been revoked in 2003. Nice.
Litigation Release No. 19680 [SEC]
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