Hedge fund hijinks
From dailynews.com, we've got this story about two local gents who swindled investors out of $2.5 million. That's a lot of money, even in the hedge fund world.
The founder of an investment company and an ex- securities broker are set to be sentenced today for their roles in a hedge fund fraud that bilked at least $2.5 million from investors.
Keith Gilabert, 36, of Valencia, and Justin Paperny, 32, of Studio City, are scheduled to be sentenced in separate hearings this morning before U.S. District Judge Stephen Wilson in downtown Los Angeles.
Gilabert, who operated a company called Capital Management Group, pleaded guilty in June 2006 to conspiracy to commit mail fraud, wire fraud and securities fraud. He faces up to five years in federal prison.
In his plea agreement, Gilabert admitted operating a fraudulent hedge fund called GLT Venture Fund and lying to investors in an effort to persuade them to invest in it.
From September 2000 to January 2005, Gilabert collected millions of dollars from more than 40 clients, concealing he lost most of the money and misappropriated much of the rest.
Courtesy of a wire service, here's the rest.
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