Portland, OR Hedge Fund Manager, Yusaf Jawed, Pleads Guilty to 17 Counts
of Fraud in Ponzi Scheme
hedge fund manager has pleaded guilty to 17 counts of fraud in a
Ponzi scheme that defrauded investors in Oregon, Washington, California, and other
states, announced the U.S. Attorney’s Office for the District of
Oregon last week.
According to the 17-count indictment, Yusaf Jawed fraudulently raised $6.4
million in the Alpha Qualified Fund, a hedge fund under his control.
Contrary to what he told investors, Jawed invested very little of the investors’
funds. Instead, he diverted the majority of the money to pay unrelated expenses.
In Sept. 2012, the
SEC filed a complaint against Yusaf Jawed that accused him of using false marketing materials to persuade at least
100 investors across the Pacific Northwest to invest more than $37 million
in several of the hedge funds he managed. He also allegedly “created
phony assets, sent bogus
account statements to investors, and manufactured a sham buyout of the funds to make investors
think their hedge fund interests would soon be redeemed,” said the SEC.
Each federal fraud count carries a maximum sentence of 20 years in prison,
but Jawed will likely serve less time. As part of his plea agreement,
both the defense and the prosecution have agreed to recommend a sentence
of 6 ½ years in prison, plus payment of restitution and forfeiture
of ill-gotten gains.
Sentencing is scheduled for June 21. For additional information on the
Yusaf Jawed investment fraud case, click here.