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SEC Charges West Palm Beach Hedge Fund With Fraud

SEC Charges West Palm Beach Hedge Fund With Fraud 150 150 Robert H. Rex

By Robert H. Rex, Esq.

On June 23, 2014, the Securities and Exchange Commission (SEC) charged West Palm Beach, FL, hedge fund Weston Capital Asset Management LLC and founder Albert Hallac with fraudulently shifting investor money from one investment to another. Hallac, his son Jeffrey Hallac, and Keith Wellner, general counsel for the company,  kept some of the transferred investor money. 
 
The SEC suit alleges that more than $17 million was drained from the fund and transferred to another company Swartz IP Services Group Inc. This transaction was contrary to the hedge fund’s stated strategy and was not disclosed to investors who continued to receive statements that falsely hid the unauthorized transaction. 
 
“Investment advisers owe their clients a fiduciary duty of utmost good faith and full disclosure about what they’re doing with their money, ‘ according to Eric I. Bustillo, director of SEC’s Miami Regional Office. 
 
Wellner and Jeffrey Hallac agreed to pay $120,000 each disgorgement. The monetary sanctions against Weston Capital and Albert Hallac have not yet been determined. 
 
If you have questions about losses in your brokerage account, call to discuss your legal rights with an experienced securities attorney. No charge for initial consultation and cases are handled on a contingent fee basis. 
 
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