Federal regulators have won a court order against a Greenwich hedge fund manager they accuse of funneling hundreds of millions of dollars from investors in his funds to the $3.7 billion Ponzi scheme run by convicted Minnesota businessman Tom Petters, The Associated Press reports.
The Securities and Exchange Commission announced Monday the order by a federal judge in Minneapolis against Greenwich fund manager Marlon Quan. The order issued Friday by the judge freezes about $14 million that Quan was to get from a court-appointed receiver in the Petters case to settle claims against Petters by investors in Quan’s funds, the agency said.
The SEC filed civil charges against Quan of violating the securities laws and aiding the Petters fraud. The agency also says Quan negotiated an agreement with the receiver to “divert” the Petters settlement funds to him and others instead of to the swindled investors.
The SEC also is seeking unspecified restitution and penalties against Quan. An attorney representing Quan didn’t have an immediate comment Monday.
Petters was convicted in 2009 on 20 counts of wire fraud, mail fraud, money laundering and conspiracy in one of the biggest Ponzi cases in recent years. He is serving a 50-year prison sentence but is appealing his conviction.
