A hedge fund manager in Beverly Hills, California, bilked investors out of about US$44 million while claiming annual returns of as much as 60 percent, US prosecutors said.
Bradley Ruderman, 46, was taken into custody on Friday morning after he surrendered to federal agents, US Attorney Thomas O’Brien said in a statement.
Ruderman, the founder and manager of Ruderman Capital Partners, faces as long as 20 years in prison if convicted of wire fraud, according to the statement.
The fund manager raised US$44.3 million over the past eight years from 22 investors, mostly family members, according to the statement. Ruderman sent a letter to the investors last month saying the funds were almost depleted, prosecutors said.
Ruderman spent US$8.7 million of the money on personal expenses, including two Porsches and US$5.2 million he lost in clandestine poker games, prosecutors said.
The Securities and Exchange Commission (SEC) sued Ruderman on April 30 and got an emergency court order freezing his assets.
Ruderman falsely claimed that Lowell Milken, chairman of the Milken Family Foundation, and Oracle Corp chief executive officer Larry Ellison were investors in his funds, the SEC said.
He also made at least one Ponzi-like payment earlier this year when an investor sought to withdraw US$750,000 and Ruderman transferred funds raised from two new investors, the SEC said.
Ruderman was released on US$500,000 bail on Friday afternoon, FBI spokesman Laura Eimiller said in an e-mailed statement.
UK ARRESTS TWO
Meanwhile, Britain’s Serious Fraud Office (SFO) arrested two men on Friday in a probe into collapsed hedge fund Weavering Capital, which it said used swaps to artificially inflate its value.
The watchdog searched two houses in Kent and Surrey, and the two men, aged 43 and 45, were taken to a police station for questioning, it said.
An SFO spokesman declined to name the two, the first arrests of hedge fund managers in the UK since the start of the credit crisis. No further arrests were expected for the moment.
Liquidators to the Weavering Macro Fixed Income hedge fund were appointed in March after the firm told investors it had unearthed a large interest rate swap position where the counterparty was a firm related to Weavering.
The investigation is focused on the swaps, which “inflated the apparent net asset value of the Macro fund,” and were between the fund and a company registered in the British Virgin Islands, Weavering Capital Fund Limited, the SFO said.
CHIP WAR: Tariffs on Taiwanese chips would prompt companies to move their factories, but not necessarily to the US, unleashing a ‘global cross-sector tariff war’ US President Donald Trump would “shoot himself in the foot” if he follows through on his recent pledge to impose higher tariffs on Taiwanese and other foreign semiconductors entering the US, analysts said. Trump’s plans to raise tariffs on chips manufactured in Taiwan to as high as 100 percent would backfire, macroeconomist Henry Wu (吳嘉隆) said. He would “shoot himself in the foot,” Wu said on Saturday, as such economic measures would lead Taiwanese chip suppliers to pass on additional costs to their US clients and consumers, and ultimately cause another wave of inflation. Trump has claimed that Taiwan took up to
A start-up in Mexico is trying to help get a handle on one coastal city’s plastic waste problem by converting it into gasoline, diesel and other fuels. With less than 10 percent of the world’s plastics being recycled, Petgas’ idea is that rather than letting discarded plastic become waste, it can become productive again as fuel. Petgas developed a machine in the port city of Boca del Rio that uses pyrolysis, a thermodynamic process that heats plastics in the absence of oxygen, breaking it down to produce gasoline, diesel, kerosene, paraffin and coke. Petgas chief technology officer Carlos Parraguirre Diaz said that in
Japan intends to closely monitor the impact on its currency of US President Donald Trump’s new tariffs and is worried about the international fallout from the trade imposts, Japanese Minister of Finance Katsunobu Kato said. “We need to carefully see how the exchange rate and other factors will be affected and what form US monetary policy will take in the future,” Kato said yesterday in an interview with Fuji Television. Japan is very concerned about how the tariffs might impact the global economy, he added. Kato spoke as nations and firms brace for potential repercussions after Trump unleashed the first salvo of
SUPPORT: The government said it would help firms deal with supply disruptions, after Trump signed orders imposing tariffs of 25 percent on imports from Canada and Mexico The government pledged to help companies with operations in Mexico, such as iPhone assembler Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), shift production lines and investment if needed to deal with higher US tariffs. The Ministry of Economic Affairs yesterday announced measures to help local firms cope with the US tariff increases on Canada, Mexico, China and other potential areas. The ministry said that it would establish an investment and trade service center in the US to help Taiwanese firms assess the investment environment in different US states, plan supply chain relocation strategies and
RSS