Investors Try to Oust Ribotsky from NIR Group Liquidation

N.I.R. Group investors are not too pleased about a voluntary liquidation of all the AJW funds set into motion by the hedge fund last week. Today I reported for DealFlow Media ,Corey Ribotsky the fund’s manager, wrote his offshore investors on March 31st announcing the liquidation and altering them to the fact that some investors don’t like the self appointed liquidator he chose.

In his investor letter Ribotsky detailed why he’d hand pick KPMG as the liquidator for the fund. He then tried to sell investors on why Kinetic Partners, who some offshore investors want in charge of the liquidation, wouldn’t serve their best interest. What’s odd is he left out the part that if KPMG became the liquidator they’d hire a company named First Street to do the valuations and act as the manager. According to some offshore investors who did a little digging, First Street is owned or controlled by Ribotsky. Ribotsky would not deny this statement when I asked for comment.

Ironically, Barron’s named AJW Offshore one of the top 50 hedge funds for 2008 because Ribotsky claimed the fund had 3-year annuliazed returns of 16.24%. In conversations with investors they now express doubt they’ll recover much of their initial investment after the liquidation is through.

Tomorrow there is a hearing in the Grand Court of the Cayman Islands to see if Ribotsky gets kicked out of managing parts of the wind down.

One of the issues investors have raised in letters sent to the Cayman Islands judge, is the fact that Ribotsky and NIR Group are being investigated by Federal regulators. A story I reported back in 2009 and was equally covered by Nathan Vardi at Forbes. They basically state they don’t trust Ribotsky to wind down the fund. Now the SEC and DOJ never officially comment on investigations but we got this very interesting piece of news yesterday.

One of NIR’s portfolio companies (Ingen run by Scott Sand) was charged for fraud and securities violations this fall. I reported at DealFlow in December that Sand was likely to turn on Ribotsky and help the DOJ or SEC with their case to get a lighter sentence. Well I learned that speculation became fact after I read Sand’s appeal for sentencing. His lawyer states in documents filed in Federal court that Sand had flown to New York to interview with government regulators (the Brooklyn DOJ is covering the case) and to the SEC office in Miami to share information against Ribotsky. We also learned he turned over hundreds of documents to help regulators figure out if any laws were broken.

It will be interesting to see if the Cayman Islands judge takes these facts into consideration when appointing a liquidator. For now we wait to see if Ribotsky will ever be charged by the SEC for securities violations surrounding how he ran his PIPE deals or if the DOJ charges him for inflated assets under management to reap excessive fees. Heck it’s been two years since they started the investigations you’d think they might have figured it out by now.

Update 4.11.2011 – According to a person who was at the Cayman Islands hearing neither KPMG or Kinetics was appointed. It was PriceWaterhouseCoopers (PWC) who won the contract for liquidation of the AJW Offshore fund. KPMG is still the liquidator for the Master Fund.


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  1. Employee have signed a final settlement letter with the company before commencement of liquidation..

  2. Wow PWC what a surprise! Very interesting, thank you for posting.

  3. Alivia Hess says

    Hello – excellent feed
    Do you have a facebook fan page? I searched 4 one on fb or myspace but couldnt find one, I would love 2 become a fan!

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