The Wall Street Journal’s Jean Eaglesham reports on Mark Malik, a purported hedge fund manager who in fact defrauded his clients of their money.
The 33-year-old New Yorker ran his own hedge fund, reporting assets of $100 million and eye-popping returns that won plaudits from several services that rank hedge funds. He explained he had honed his skills at top investment banks and a boutique trading firm.
A $1 billion deal to take his company public was in the works, he told investors, and he was hiring dozens of analysts and opening offices across the world, he said. In December, an industry publication reported on his successful launch of a second $100 million fund, called Wolf Hedge Global Strategy.
But Mr. Malik was a fraud, say New York prosecutors and the Securities and Exchange Commission. He only raised a fraction of the amounts he said he did, never made any real investments and used the money to pay for a lavish lifestyle, they say. The SEC accuses him of stealing more than $700,000 from investors. If Mr. Malik is convicted, his case would show how fraudsters can exploit fund-ranking services.
Read more here.
