BusinessCompany NewsMan-UBS case leads to fraud charges in USA

Man-UBS case leads to fraud charges in USA

A Canadian hedge fund manager at the centre of a legal battle between former brokerage of Man Group and UBS has been charged with fraud

US prosecutors have accused Paul Eustace, founder and principal trader of the
now defunct Philadelphia Alternative Asset Management Company (PAAM), of
creating accounts which showed his hedge fund was making money when in fact it
was losing tens of millions of dollars.

He was also charged with increasing his management fees based on bogus
accounts, and making loans to himself with investors’ cash, including $US500,000
(?239,000) to pay off a legal settlement.

According to a two-count fraud indictment, Eustace opened several accounts at
Man
Group
brokerage, including one called the ‘10 account’, where profitable
trades were placed, and one called the ‘50 account’, where losing trades were
held, FT.com reports.

He also opened an account at
UBS, which was administered by
the Swiss bank’s Cayman Island operations.

Further reading:

Insider Business Club: economic recovery

Read
the story in FT.com

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