Click here for information on the investigation into the Mount Vernon Police Department. . IIG, an SEC-registered investment adviser, provided investment management and advisory services, including for three private funds that it operated: (1) the IIG Trade Opportunities Fund N.V. (TOF); (2) the IIG Global Trade Finance Fund, Ltd. (GTFF); and (3) the IIG Structured Trade Finance Fund, Ltd. (STFF). Please try again. Your article was successfully shared with the contacts you provided. Get alerted any time new stories match your search criteria. We and our partners use cookies to Store and/or access information on a device. IIGs trade finance loans were purportedly secured by collateral, such as the underlying traded goods, assets held by the borrowers, or expected payments by third parties. U.S. District Judge Alvin K. Hellerstein announced the sentence Monday and it will be formally imposed following the conclusion of forfeiture and restitution proceedings in the case, Williams said. Giving back to the community through a variety of venues & initiatives. Dont forget you can visit MyAlerts to manage your alerts at any time. Former IIG Managing Partner David Hu gets 12 years jail time for U.S. Attorneys Office for the Southern District of New York, CDC warns of meningococcal disease outbreak affecting gay, bisexual men in Florida, Chipotle Turns to Automation to Offset Staff Shortages, Skywatchers: Mays Full Flower Supermoon will be followed by a lunar eclipse, Rare 12-foot Sicklefin Devil ray spotted off US East Coast, Great Britain CMA stalemates Microsoft-Activision Blizzard deal. According to the allegations contained in the Information and based on statements made in Manhattan federal court: SILVER and a co-conspirator (CC-1) founded IIG in 1994. IIG and, in turn, HU, received a performance fee with respect to the IIG Funds, as well as a management fee, which was calculated as a percentage of the assets under management held in the Funds. The co-founder of an investment advisory firm based in New York was sentenced Wednesday to 13 months behind bars for stealing more than $100 million from clients in a Ponzi-like scheme. My Office remains committed to policing investment advisers who seek to take advantage of their clients for personal and professional gain.. SanctuaryWealth Picks Up $1B Advisory Team From Merrill, Friend of Warren Buffett Unpacks His Investing Wisdom, Cetera Adds Direct, Custom Indexing to Advisory Platform, 9 Trends That Sum Up the State of RIAs: Cerulli, Wells Fargo Appeals Arb Ruling Struck Down in Court. In offering memoranda and communications with investors, IIG advertised strict risk controls, such as promises to use diligence to carefully select borrowers or issuers with trusted management and marketable assets, and portfolio concentration limits based on borrower, developing country, and industry. In addition to the 12 years of prison time, the judge also ordered Hu to serve three years of supervised release. Silver officially opposed the relocation of a methadone clinic that was proposed to be located close to one of Glenwood's rental buildings in Silver's district. Latest from Department of Justice Press Releases, Rochester Man Who Fled Police Pleads Guilty To Gun Charge, Man Who Produced Child Pornography Going To Prison For 26 Years, Getzville Man Going To Prison For Threatening To Kill Police Officers, Kenmore Man Pleads Guilty To Fentanyl Charge, Statement From U.S. Attorney Jason M. Frierson On National Human Trafficking Prevention Month, Grand Junction Man Sentenced to Life in Federal Prison for Distribution of Fentanyl Resulting in Death, California-Based Company, Company President Plead Guilty in Scheme to Violate the Export Control Act, Man Sentenced for Three Richmond Armed Robberies, Henrico Man Pleads Guilty in $1.1 Million COVID-19 Fraud Scheme, Subway shed more U.S. sandwich shops in 2022 -document. You are now logged in. In March 2018, IIG reported to the SEC that it had about $373 million in assets under management. Securities and Exchange Commission v. Silver. These Distressed Loans included, for example, loans for which the borrowers had missed multiple scheduled payments. Advisory Firm Gets 12 Years For $120M Ponzi Scheme. They conspired to defraud IIG investors from approximately 2017 to 2019. Silver begged for mercy ahead of his sentencing in a letter to the judge, saying he was "broken-hearted" he had caused people to lose faith in government. On March 23, 2023, the U.S. District Court for the Southern District of New York entered a final consent judgment against Martin Silver, the co-founder of International Investment Group (IIG), a formerly registered investment adviser, enjoining him from violating the antifraud provisions of the federal securities laws. ------------------------------------------, Former Head Of N.Y. HU was a managing partner and the chief investment officer of IIG. IIGs trade finance loans were purportedly secured by collateral, such as the underlying traded goods, assets held by the borrowers, or expected payments by third parties. Updated. Pursuant to Fed. MARTIN SILVER, 63, of New Jersey, pled guilty to one count of conspiracy to commit investment adviser fraud, securities fraud, and wire fraud, which carries a IIG also advised the Venezuela Recovery Fund (VRF), a fund that managed the remaining assets of a failed Venezuelan bank (VRF, together with TOF, GTFF, and STFF, the IIG Funds). According to the From approximately 2007 to 2019, HU conspired to defraud investors in IIG-managed funds by: (i) overvaluing distressed loans held by the IIG Funds, (ii) falsifying paperwork to create a series of fake loans that were classified, fraudulently, as positively performing loans, and to otherwise hide losses, (iii) selling overvalued and fake loans to a collateralized loan obligation trust and new private funds established and advised by IIG, and (iv) using the proceeds from those fraudulent sales to generate liquidity required to pay off earlier investors in a Ponzi-like manner. Mr. Williams praised the investigative work of the FBI and also thanked the U.S. Securities and Exchange Commission for its assistance. Manhattan U.S. Attorney Audrey Strauss said: Today, Martin Silver admitted to participating in a sophisticated, decade-long scheme to defraud IIG funds and investors, abandoning his fiduciary responsibilities to IIGs clients, and causing millions of dollars of losses. Creating fictitious loans in order to hide the losses resulting from the Defaulted Loans, including from auditors reviewing TOFs financials, by removing the Defaulted Loans from the TOF portfolio and replacing them with tens of millions of dollars in fictitious loans to purported borrowers in foreign countries (the Fake Loans). WebMartin Silver *6170 Citibank may transmit payment electronically to the Commission, which will provide detailed ACH transfer/Fedwire instructions upon request. U.S. District Judge Alvin Hellerstein issued the sentence against Hu on Monday. a};@_5,}V$dYOKl'[>r. Jacqueline Sergeant. In January 2021, Hu pleaded guilty to investment adviser fraud, securities fraud, and wire fraud offenses. If you would like to change your settings or withdraw consent at any time, the link to do so is in our privacy policy accessible from our home page.. The former managing partner and chief investment officer of a New York-based investment advisory firm has been sentenced to 12 years in prison for his role in defrauding clients and investors in a more than $120 million Ponzi scheme, according to the U.S. Attorney for the Southern District of New York. Venus and Jupiter begin the We are The People's Media. David Hu, the former managing partner of International Investment Group (IIG) was sentenced to 12 years in prison for his role in defrauding investors of more than $120 million in a Ponzi-like scheme. The night sky in May will be filled with exciting sights. . The court said beginning in 2007, Hu and others engaged in various deceptive acts to cover up losses in its Trade Opportunities Fund (TOF). The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. Then, HU caused the CLO Trust to enter into fake loan transactions with the Panamanian Shell Entities. Making sure that victims of federal crimes are treated with compassion, fairness and respect. Manage Settings In or about February 2017, a borrower (the Argentine Borrower) had failed to pay the principal on an approximately $6 million loan (Loan-1) in which the Retail Fund had invested and which was nearing its maturity date. Attorneys Drew Skinner, Negar Tekeei, and Alex Rossmiller are in charge of the prosecution. IIG advertised itself as specializing in global trade financing, particularly in providing trade finance loans to small and medium-sized businesses. From approximately 2007 to 2019, SILVER conspired to defraud investors in IIG-managed funds by: (i) overvaluing distressed loans held by the IIG Funds, (ii) falsifying paperwork to create a series of fake loans that were classified, fraudulently, as positively performing loans, and to otherwise hide losses, (iii) selling overvalued and fake loans to a collateralized loan obligation trust and new private funds established and advised by IIG, and (iv) using the proceeds from those fraudulent sales to generate liquidity required to pay off earlier investors in a Ponzi-like manner. Trade finance loans are used by small and medium-sized companies, typically exporters and importers, to facilitate international trade. Inducing a retail mutual fund to invest in a fictitious $6 million loan. In March 2018, IIG reported to the SEC that it had approximately $373 million in assets under management.
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