Nadel pleads not guilty to $360m investment fraud

1 May 2009

Hedge fund manager Arthur Nadel has pleaded not guilty to a 15-count indictment accusing him of orchestrating a $360 million investment fraud.

Federal prosecutors contest that Mr Nadel engaged in securities fraud, wire fraud and mail fraud to dupe 350 investors into handing over their money.

According to the government's complaint, the hedge fund manager collected millions of dollars in fees by misrepresenting the historical returns and assets of the funds under his control.

Investors are said to have been misled by the alleged fraud for the last ten years.

Mr Nadel is currently in custody as he cannot meet the conditions of his $5 million bail. Judge John Koeltl scheduled a hearing for June 4th to hear arguments over the bail conditions.

Defense attorney Mark Gombiner said he would dispute the government's contention that Mr Nadel represents a flight risk.
The hedge fund manager went missing when he was initially charged with fraud by the Securities and Exchange Commission. He turned himself in two weeks later in Florida.

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