SEC Targets Use of Side Pockets by Hedge Funds

The Securities and Exchange Commission's Asset Management Unit has been investigating whether hedge fund managers have overvalued assets in "side pockets" and then charged investors higher fees based on those inflated values. A side pocket is a type of account that hedge funds use to...

SEC Continues Crackdown on Overvaluations of Hedge Fund Assets

As we have previously discussed here , the Securities and Exchange Commission's Asset Management Unit has been investigating whether hedge fund managers overvalue illiquid assets so as to generate higher management fees. Most recently, on October 25, 2010, the SEC charged hedge fund manager...

Hedge Fund Manager Settles With SEC And USAO

Lawrence Goldfarb, the manager of a successful hedge fund, and the fund he managed, settled charges with the SEC and the U.S. Attorney's Office stemming from his diversion of over $12 million from a side pocket investment of the fund. Investors knew that the assets had been placed in the side...