SEC Obtains Final Judgment Against Hedge Fund Fraudster
A federal court in Boston, Massachusetts, entered a final judgment against Yasuna Murakami, a former Massachusetts-based hedge fund manager, and two advisory entities he operated in connection with a scheme to defraud investors by hiding trading losses and misappropriating investor funds.
A federal court in Boston, Massachusetts, entered a final judgment against Yasuna Murakami, a former Massachusetts-based hedge fund manager, and two advisory entities he operated in connection with a scheme to defraud investors by hiding trading losses and misappropriating investor funds.
In May 2017, the SEC filed an enforcement action against Murakami and his advisory entities, MC2 Capital Management LLC and MC2 Canada Capital Management LLC. The SEC alleged that Murakami misappropriated investor funds for business and personal expenses and made approximately $1.3 million in Ponzi-like payments.
The SEC also charged Murakami’s former business partner, Avi Chiat, who allegedly helped Murakami raise money from investors while providing investors with fabricated account statements that overstated investment performance. The SEC’s litigation against Chiat is ongoing.
Murakami, who pled guilty to wire fraud in a Massachusetts federal court earlier this year, was sentenced to six years in prison and ordered to pay restitution for defrauding investors.
In connection with his plea, Murakami admitted to diverting millions of dollars of investor funds to business and personal accounts that he controlled, and using the money to pay for personal expenses such as a luxury sports car, international travel, and high-end department stores, and to make Ponzi scheme-like payments to investors who requested redemption.
Murakami also admitted to withholding material information regarding the management of a hedge fund, and to providing investors with falsified account statements and tax documentation.
Murakami and his two advisory companies settled with the SEC and collectively agreed to pay more than $7.9 million in disgorgement and prejudgment interest, to be deemed satisfied by a restitution order entered in the related criminal case.
The SEC has permanently barred Murakami from association with any investment adviser, broker-dealer, municipal securities dealer, municipal advisor, transfer agent, or statistical rating organization.
