|
Hedge-Fund Adviser Arthur Nadel Pleads Innocent in Fraud Case
|
|
(April 30, 2009 - Thursday) - http://www.bloomberg.com/apps/news?pid=20601103&sid=abeelQNtmCDU&refer=us
By David Glovin
April 30 (Bloomberg) -- Arthur Nadel, the jailed Florida hedge-fund adviser arrested in January, pleaded not guilty to a 15-count federal indictment accusing him of fraud.
Nadel, who is being held in prison until he posts a $5 million bond, entered his plea today before U.S. District Judge John Koeltl in New York. The indictment, which was unsealed on April 28, also seeks to force Nadel to forfeit $360 million and property.
Nadel, a money manager and founder of Scoop Management Inc. in Sarasota, Florida, disappeared for two weeks in January after Florida authorities began investigating investor complaints about missing money. He was charged Jan. 21 in federal court in New York with securities and mail fraud. Nadel, 76, surrendered six days later in Tampa and was transferred to Manhattan.
At least 350 investors in Nadel’s funds were told they had more than $360 million in their accounts when there was less than $125,000, prosecutors say. Assistant U.S. Attorney Maria Douvas previously said in court that Nadel took in $63.9 million in fees and trading profits in recent years, including $45 million from 2005 to 2007.
Nadel told clients “that his purchases and sales of securities in funds had generated cumulatively more than $271 million in gains,” Acting U.S. Attorney Lev Dassin said in a statement announcing Nadel’s indictment. “In truth, Nadel’s trading resulted in an overall net loss.”
Nadel is represented by a public defender because his assets were frozen in a civil case brought by the U.S. Securities and Exchange Commission. Lawyer Mark Gombiner has said the case is more complicated than it appears.
The indictment, which marks the formal filing of charges, includes six counts of securities fraud, eight counts of wire fraud and one count of mail fraud. Nadel faces a maximum 280 years in prison if convicted.
The criminal case is U.S. v. Nadel, 1:09-mj-00169, U.S. District Court, Southern District of New York (Manhattan).
To contact the reporter on this story: David Glovin in U.S. District Court in New York at dglovin@bloomberg.net.
|
