Since 1999 our law firm has recovered more than $350,000,000 for victims of investment fraud and misconduct.
Jury Verdict Won Against Prudential Securities $262 Million
Recovered for 100-Year Old Widow $30 Million
Recovered in Retirement Losses $10 Million
Recovered for a Large Group of Individual Investors $6.5 Million
Recovered for Elderly Victim in Ponzi Scheme Case $3.8 Million
Recovered for Elderly Ponzi Scheme Victim $3.2 Million
Recovered for More Than 50 Families of Ponzi Scheme in California $3.2 Million
Recovered for 35 Families in Northeast Ohio $3.1 Million
Losses Recovered for 20 Retirees $3 Million
Recovered for Retired Physician Against Major Wall Street Firm Prior to Filing FINRA Arbitration $2.5 Million
What Are Signs of Hedge Fund Fraud? How Can I Protect Myself?
We at Meyer Wilson encourage you to come in and speak with our attorneys if you suspect you’ve sustained investment losses due to hedge fund fraud. Hedge fund fraud cases can be particularly complicated, and you will probably find it helpful to discuss the details of your situation with an experienced professional who can offer specific guidance and protect your interests.
That being said, there may be many signs that a hedge fund is an investment scam:
- Prior investor complaints or litigation history
- A concentration in illiquid or difficult-to-value investments
- Pressure to invest or assurances that the hedge fund is “completely safe”
- A lack of regular audits by an independent accounting firm
- Unusually good performance long term, especially in a poor market
- Lack of transparency or lack of trading independence
- Managers who trade in their own accounts
Additionally, according to the FBI, most legitimate hedge funds charge 1-2% of total assets managed and 20% of profits. Legitimate fund managers don't earn commissions on sales. If a hedge fund manager is being paid on commission, then that could be a red flag.
Due Diligence Key to Protecting Against Hedge Fund Fraud
With more examples of hedge fund fraud coming to light all the time, it is difficult to remember that legitimate hedge funds do exist. In fact, hedge funds can offer significant benefits to wealthy, sophisticated investors. However, due to the fact that hedge funds are private investment partnerships that are subject to minimal regulations and utilize complex investment strategies, they often carry a great deal of risk, including the risk of fraud. It is for this reason that conducting proper due diligence is absolutely necessary in order to protect oneself from fraud.
On its website, the FBI offers tips for investors on how to conduct a thorough investigation into the legitimacy of a hedge fund. Some examples of proper due diligence include:
- Reviewing www.SEC.gov for past regulatory actions against the fund manager;
- Locating and speaking with fund administrators and noting their independence;
- Being sure a reputable independent accounting firm performs an annual audit; and
- Hiring a non-affiliated due diligence firm to perform a more thorough background check.
Stockbroker fraud related to hedge funds can cause serious losses for vulnerable investors—and recovering those losses can be difficult. If you have lost money investing in a hedge fund and suspect fraud, please reach out to an experienced investment fraud attorney today to learn more.
You can learn more about hedge funds by watching our helpful video:
More than $350,000,000 Recovered
Voted Best Lawyers in America® for Ten Years Running
David Meyer is President of Public Investors Advocate Bar Association (PIABA)
Over a Thousand Investor Claim Cases Since 1999
Exclusive Focus on Investor Claims & Class/Mass Action Lawsuits
Deep Bench of Skilled Attorneys and Staff Members
Meyer Wilson has represented over 1,000 individual investors in high-stakes claims across the country, and has recovered over $350 million on their behalves. See what former clients have to say about our team.