Investment Answer from SEC to White Collar Mobsters

Jack Humphrey, Regulatory journalist
January 20, 2011 /

The Securities and Excange Commission (SEC) charged three investment companies and four managers with misappropriation of clients assets, fraud and securities law breaches, that were made using their consulting company.

Steven Gould, CFO; Janis Barsuk, Controller; William Landberg, investment advisor and Kevin Kramer, president are involved in the case via West End Financial Advisors LLC (WEFA), West End Capital Management LLC (WECM), and Sentinel Investment Management Corporation. It is important to note, that William Landberg was Chief Compliance Officer of Sentinel Investment as well.

SEC accuses these people and companies in deliberate hiding the fact that West End group had financial problems due to wrong investment strategies, making investors believe, that they make investments in steady companies.

SEC filed complaint to Court of Southern District of New York on this matter. According to the filling, misrepresentation occurred from January 2008 till May 2009 ($4.7 million raised from investors).

To maintain impression of successful firm bank loans from WestLB and DZ Bank AG, amounting $8.5 million were partially distributed to several clients were used. Also, there is personal misappropriation of these loans by Landberg and his family amounting $1.5 million.

Gould and Barsuk alleged in knowing or recklessly not knowing fraudulent schemes Landberg deployed to get loan from bank. Additionally, Steven Gould, CFO, may have used creative accounting techniques to hide fraudulent activities and issued financials with false investment returns.

Further SEC’s litigation effort will be led by Howard Fischer.

 

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