Six months after Bernard Madoff raised the bar for hedge fund malfeasance, the Securities and Exchange Commission has charged two separate money managers with operating Ponzi schemes that drew a total of approximately $30 million in investor money.
The SEC believes that Massachusetts-based manager Michael C. Regan obtained at least $15.9 million from investors by selling stakes in a personal hedge fund. Regan shared false tax statements and account information with investors that claimed average annual returns of about 20 percent.
Regan claimed to have an MBA and a successful resume of securities trading; he in fact has no such background, as is not registered with the SEC as an advisor.
Separately, the SEC alleges that a California hedge fund manager, Moises Pacheco, bilked investors out of $14.7 million over several years. Pacheco promised annual returns between 30 and 48 percent, issuing false monthly statements to cover his claims.