Diamonds are Hedge Fund’s Worst Enemy

Blomberg is reporting that Yu Jieying, the sister of the founder of defunct Canadian hedge fund Portus, allegedly blew $8.8 million of investors’ money on diamonds. KPMG, the accounting firm investigating the demise of the fund, is urging a Hong Kong judge to force Jieying to answer questions about the jewels, which included a 22-carat gem. Founded by Manor and Michael Mendelson in 2002, Portus became one of the fastest-growing hedge funds in Canada. The fund’s customers invested more than $630 million before the fund was forced to cease operation in February of this year because of its alleged diversion of more than $75 million--12 percent of the total value of the fund--to commissions, referral fees and other expenses. Investigators are trying to get their arms around the fund’s offshore shenanigans as well.
Portus In-Law Sought for Questioning [Bloomberg]
Portus Lawsuit [Greg Monforton & Partners]

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