Fraud and Deception - $1B International Loan and Hedge Fund Scam

New York (HedgeCo.net) – The founder of Hong Kong-based hedge fund consultancy company and New York lawyer has been linked to two Liechtenstein businessmen recently fined $157 million each for their part in a US loan scam, according to The Sydney Morning Herald.

The paper reports that the chairman of the Liechtenstein-based Jeeves Group had bought 100% of Jack Flader’s company, Global Consultants and Services Ltd (GCSL) and that Flader would act as a consultant.

GCSL was involved in a $120 million fraud scheme last year involving a hedge fund, Astarra Strategic. The NSW Supreme Court ruled last April that GCSL was responsible for directing the placement of $120 million of Australian investors’ money into funds housed in little-known Caribbean tax havens.

In November 2009 a US investor, Kevin Campbell, won a court case arguing that a stock-loan program involving the Jeeves Group and Flader had been a $1 billion Ponzi scheme that ripped off investors and paid $100 million to its promoters.

In the case before the US District Court in Charleston, South Carolina, Bryan Jeeves and his son, Alexander, were named alongside Flader as ”Racketeer influenced and corrupt organisations” defendants, according to the news source. The Jeeveses were ordered to pay $157 million each after the court accepted evidence they had breached multiple laws by committing mail fraud, wire fraud, securities fraud and money laundering.

Editing by Alex Akesson
For HedgeCo.net
alex@hedgeco.net