Tampa, FL – Arthur Nadel, the Florida hedge-fund adviser who disappeared 13 days ago, was arrested and charged with defrauding investors of tens of millions of dollars.
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Nadel, 76, surrendered to the Federal Bureau of Investigation today in Tampa, Florida, Monica McLean, an agency spokeswoman, said.
U.S. regulators last week accused him of defrauding clients while overstating six funds’ investments by $300 million.
The fraud may have been uncovered because of the unrelated arrest on Dec. 11 of fund manager Bernard Madoff for duping investors out of $50 billion, the FBI said in a criminal complaint.
After years of rebuffing requests from an unnamed partner for an independent audit of his funds, Nadel agreed to one on Jan. 8, FBI agent Kevin Riordan said in a criminal complaint. Nadel fled six days later after telling his wife how to survive financially without him, Riordan said.
“The avenues to money for you will likely be blocked soon,” Nadel wrote to his wife in a note that employees found Jan. 15 in a shredding machine, according to the complaint. “Withdraw as much cash as you can,” he said, adding that he would send further instructions.
“Sell the Subaru if you need money,” the FBI quoted him as writing.
Beginning in August, Nadel transferred at least $1.25 million from two funds to a secret bank account, prosecutors said. His funds’ total assets are now less than $1 million, the Securities and Exchange Commission said Jan. 21 in a civil fraud lawsuit.
Nadel told his partner that he graduated from New York Univrsity School of Law and was later disbarred, according to the complaint. He told investors that he had provided 20 percent returns from 1999 to 2007, it says.
The FBI cited five unnamed victims who lost money.
Two invested a combined $28.6 million in Nadel’s funds, the agency said. Nadel told one of them, who sought to withdraw funds, that there was more than $200 million in the victim’s account and the money would be available by March, Riordan said in the complaint.
Nadel is to appear in court in Tampa later today. His lawyer, Todd Foster, didn’t immediately return a call.
my goodness!!when will this all stop?
Pathetic thief did’t get very far.