Texas Hedge Fund Fraudster Pleads Guilty |
Date: Tuesday, July 7, 2009
Author: FINalternatives
A Texas hedge fund manager has pleaded guilty to running a $14 million Ponzi scheme.
Rod Stringer last week waived indictment on the money laundering charges. He faces up to 10 years in prison and a $250,000 fine.
According to the Securities and Exchange Commission, which charged Stringer with running a Ponzi scheme in January, the admitted fraudster used $2.4 million of the money raised for his phony RCS Hedge Fund to pay off other investors, and stole the rest, buying himself fancy cars, a boat, a horse-racing partnership and an office swimming pool.
Stringer, of Lamesa, allegedly told investors that the fund, which he said had $45 million in assets from 31 investors, had enjoyed phenomenal returns: Annual gains as high as 61% and total returns of more than 600%. Contrary to those grandiose claims, the SEC and Federal Bureau of Investigation say what little investing he did was a disaster, resulting in substantial losses.
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