Sextant Fraud Hearing Delayed

Date: Tuesday, May 4, 2010
Author: FIN Alternatives

Canadian hedge fund chief Otto Spork will have to wait even longer for his day in court. Or, at least, his day before the Ontario Securities Commission.

The Sextant Capital Management founder’s hearing has been delayed yet again, this time until June 7. Spork, his daughter Natalie, brother-in-law Konstantinos Ekonomidis and former Sextant chief compliance officer Robert Levack are accused of defrauding investors in the firm’s Strategic Opportunities Firm. The foursome are charged with illegal self-dealing and inflating the fund’s returns.

According to the OSC, Sextant inflated the value of the Strategic Opportunities fund and two offshore hedge funds by investing in a pair of private companies with rights to develop Icelandic glaciers. The regulator says that 95% of the hedge fund’s assets are invested in the companies, which are themselves almost totally owned by founder Otto Spork and the Sextant funds.

The OSC hearing had been set for today. Ekonomidis was added to the case only last month.

Sextant and its funds have been in receivership since last summer.