SEC knew Collecting $14.5 mn Hedgie Ribotsky fine Would Fail

N.I.R. Group hedge fund founder, Corey Ribotsky, filed for personal bankruptcy leaving a whopping $36 million of debt unpaid a year after he settled with the SEC for investor fraud. Today I am reporting for Growth Capitalist that court records allude to the notion that the government knew Ribotsky wouldn’t be able to pay his multi-million dollar fine when they backed down from taking him to trial and agreed to a settlement in 2013.

Long Island-native Corey Ribotsky ran a hedge fund that mainly invested in PIPE’s for over a decade. These are private interest bearing loans made to small cap companies that turn into discounted stock warrants if the borrow can’t payback the loan in a certain amount of time. To simplify what usually happened in N.I.R. Group PIPE transactions the borrow usually doesn’t pay back the loan and the hedge fund gets cheap stock they can sell for cash on the open market which can drag down the price of a small cap stock to unsuspecting penny stock investors. Ribotsky raised hundreds of millions of dollars from upper middle class investors that he met via his charity work, a north shore country club or through introducing brokers.

I began investigating Ribotsky for investor fraud in 2008 while reporting for the New York Post. It took the SEC until September 2011 to finally sue the hedge fund manager for securities violations & investor fraud. By the time the SEC sued, investors in N.I.R.’s once $800 million hedge fund had lost their money, and Ribotsky continued to earn millions in fees managing and unwinding a fund whose valuations were allegedly inflated.

Between investigative reporters documenting Ribotsky threatening & lying to investors, along with internal whistleblowers, the government’s case against Ribotsky was built for them before they sued. Yet at the end of the day we only saw the Securities and Exchange Commission bar Ribotsky from the industry for only four years and collect zilch from him to return to investors.

It wasn’t till three years after the securities regulator sued Ribotsky for stealing millions from his investors that we learn the government is having an impossible time collecting any money to return to N.I.R. Group investors.

On November 13 2014, SEC attorney Kenneth Byrne wrote Judge Bianco the Commission had started “collection proceedings against Ribotsky that included discovery of his income and asset”. The government never got Ribotsky to admit guilt and his lawyer Doug Hirsch told the court the SEC knew before they settled the case in November 2013 that Ribotsky didn’t have anywhere near the assets or earning potential to pay the amount the SEC wanted in a fine (See Attorney Hirsch letter below). Bankruptcy records show Ribotsky stopped making mortgage payments on his $6.8 million loan to Signature Bank in September 2012, which was secured by his family home at 11 Bostwick Lane, Old Westbury, NY. The property is in a llc called ZFL and listed as an asset owned 100% by Ribotsky. Additionally, court records show $549,321.48 in town property and school taxes have not been paid on the home dating back to 2011. On July 19th 2013, months before the SEC settlement, Signature Bank started foreclosure proceedings in Nassau County court against the home. Total debt owed by ZFL to Signature bank is now $7,203,277.78. Any SEC collection efforts would be behind Signature Bank who has a secured claim on one of Ribotsky’s largest assets. A recent order by Ribotsky’s bankruptcy judge shows Signature Bank, who claims they were close to finishing the foreclosure right before Ribotsky filed bankruptcy, will be allowed to move forward with their case and collect funds from a foreclosure auction.

Ribotsky also had ownership interest in another home, 317 Bedford Ave Bellmore NY, which is also held in a LLC. Court filings show Ribotsky testified in a bankruptcy hearing he transferred 50% of his interest in 317 Bedford to Howard Tanney at no consideration. A 2004 bankruptcy exam has been ordered against Howard Tanney to prove Ribotsky did not commit fraudulent conveyance via the home interest transfer.

The government watched reporters like myself, Matt Goldstein, and Nathan Vardi for four years detail Ribotsky’s fraud via on record sources and documents, but only managed to make one criminal arrest of Ribotsky’s right hand guy Daryl Dworkin. In 2010 Dworkin quickly turned DOJ government whistleblower and plead guilty to taking bribes while working at N.I.R. group. The fund was eventually forced into an outside receiver (PwC) taking over in the Cayman Islands who was given some decent access to a document trail of fraud allegedly committed by Ribotsky.

The SEC could have at least deposed Daryl Dworkin in their case, as court filings in SEC v. Ribotsky show the DOJ’s deal with him was he had to testify for the SEC. But the government settled right before the deposition was going to happen. Dworkin’s testimony would have at least helped investors learn what he was telling the DOJ about Ribotsky’s role in the fraud, which could have aided any investor civil suits against the hedge fund manager.

At a sentencing hearing I attended for N.I.R. Group executive Daryl Dworkin on November 5 2014 the DOJ had to admit to federal Judge Dearie they didn’t charge Ribotsky with criminal fraud because they didn’t think they had enough evidence to convict him. For four years the DOJ delayed Dworkin’s sentencing while they worked him for information against Ribotsky.

A month after the Dworkin sentencing Ribotsky finally tells his version of what he did with some of the millions he took from his investors via his chapter seven federal bankruptcy filing. The December 17 2014 bankruptcy shows he’s been sued numerous times but never paid up on judgments rendered by the court. Interest and stock in financial companies Ribotsky owned were primarily transferred to another top N.I.R. Group executive Robert ‘Bobby’ Cohen. The bankruptcy court has ordered Cohen to go through a 2004 examination of some of the transferred stock. Additionally, Christopher Machton of Great Neck NY, who got a $300,000 loan from Ribotsky has been given a 2004 exam subpoena from the bankruptcy court to prove he got the funds and how they were used.

“The government is suing him and he simply moved money around so he didn’t have to pay fines”, is what one Boston-based N.I.R. Group Investor told me after he read Ribotsky’s bankruptcy documents. In fact, in 2012 Ribotsky says in court filings he still made $1.2 million. That was the year he was getting kicked out of his fund, fighting a SEC lawsuit, and investors learned via the receiver the hedge fund assets were super hard to sell and illiquid. Meaning there wasn’t a ton of hope of getting their hard earned dollars back from the hedge fund.

The case was a complete failure by Loretta Lynch’s office (the black woman Obama has put up to be the next head of the DOJ) and an abysmal victory by the SEC – who at least got Ribotsky to agree to stop committing fraud for a few years.

At Dworkin’s sentencing hearing in Brooklyn, NY I got to see how the DOJ and SEC lawyers acted in this case. I was surprised by their egos given how little they accomplished. Government lawyers told Judge Dearie they were working hard to recover money for investors but they simply haven’t been able to do it. After the hearing I cornered SEC attorney Kenneth Byrne and a little man with horn rimmed glasses who was running the DOJ case to ask them face to face how they felt about their inability to get justice for investors and collect any money. DOJ attorney Daniel A. Spector scowled at my question and instead of answering it demanded to know my name and who I report for. I said my name was Teri Buhl and you should clearly know who I report for now. (Spector’s predecessor who started the NIR Group case had interviewed me in 2009 to get help finding NIR investors Ribotsky had lied to so I know the DOJ had been reading my reporting.) Attorney Spector’s ego kicked in and gave me a smug look saying they can’t comment on the case except what I heard them say in court. Now after a case is over the DOJ can comment and usually issues a press release. But in this case the PR girl for the DOJ admitted since there was no jail time for Dworkin there wouldn’t be a public comment. Meaning they didn’t want to promote a case that got so little for investors.

As I watched the SEC attorney and the DOJ boys leave the court room and slink into the elevator I did something I rarely do when asking subjects of a story questions. I asserted my opinion. I looked them both in the eye and said, “You should be ashamed of yourself for not doing more for the defrauded investors. You had this case handed to you an a platter.”

Attorney Spector’s rebuttal was silence and later in the day he refused to get his press person to answer how much Dworkin was ordered by the judge to pay in a forfeiture bond. The bond was ordered in court but the amount was not mentioned. This was public record and they had to answer my reporter question. Instead they stonewalled me and we had to wait a few days to print the news of Dworkin’s sentencing at Growth Capitalist until all the court documents from the hearing were filed online. Dworkin received NO jail time, no penalty fine for his three felony convictions, and only a forfeiture bond to give back the $400,000 he had taken in bribes to bring PIPE deals to N.I.R. Group. And to this day we don’t know if the government will even collect that from him given he can’t earn big money working on Wall Street any more and he told the court his home is in foreclosure.

For those of you familiar with Ribotsky I have uploaded a copy of his unsecured creditors. Tom Sporkin, securities attorney at Buckley Sandler who was a former SEC enforcement lawyer, told me it is very hard to get a bankruptcy court to forgive a government fine so Ribotsky will technically still be liable for the $14.5 million the SEC is supposed to extract from him. But chances of that happening are zero to none in my view. I’d expect Ribotsky to end up moving to the Cayman Islands. A place one of his former best friends told me he often took a private jet to and visited an off-shore bank; after he’s done telling an American bankruptcy court he has no money to pay $36 million back.

Ribotksy attorney Doug Hirsch letter to Judge in SEC case over lack of ability for Ribotsky to ever pay SEC fine.

Ribotsky Attorney Letter to Judge Over Nonpayment by Teri Buhl

Ribotsky List of Bankruptcy Creditors


Corey Ribotsky Bankruptcy Creditors by Teri Buhl


Plainfield Asset Mgt Investors Insulted by Ex- Hedgie Executive’s Cheap Cash Offer

A former top dog portfolio manager at hedge fund Plainfield Asset Management, Marc Sole, is using the funds of his new hedge fund to try and buy out remaining investors in the now defunct Plainfield for a discount. According to offer documents seen by this reporter Sole, who now works for $4 billion Hudson Bay Capital, offered investors in four liquidating Plainfield funds 52 cents on the dollar. The problem is investors say they never received a transparent valuation from Plainfield, or the liquidator PwC Cayman, of the remaining amount of their interest in the funds.

Plainfield made international headline news in 2008 for gating their $5 billion hedge fund and locking investors from cashing out. The fund founded by Max Holmes, who now teaches at NYU’s Stern school of business, was investigated by the SEC for inflating investors assets to receive excessive fees. The SEC cleared the fund of its investigation in June 2012, according to a letter from the SEC, but Holmes was extremely slow in winding down the fund. Plainfield 2008 Liquidating Ltd. and Plainfield 2009 Liquidating Ltd. were put into voluntary liquidation in the Cayman Islands on December 31st 2013 according to public filings at According to investors, the portion of assets in these funds is only a sub/residual piece of what Plainfield had originally invested in.

Plainfield was also investigated by the Manhattan D.A. for its loan to own practices with small cap companies but was never charged by the D.A. for wrong doing.

Sole started with Hudson Bay in 2011, he was one of Max Holmes right hand guys helping pick investments for the failed fund. The Hudson Bay Absolute Return Credit Opportunities Fund made the offer to Plainfield investors, who are mostly institutional money, on December 16th 2014. Investors were given only 30 days to decide if they want to take the deal. Ian Stokoe and David Walker are running the Plainfield liquidation at PwC Cayman.

Sole chose to enlist the help of Plainfield’s former General Counsel Thomas X. Fritsch who is now an attorney for white-shoe Wall St. law firm Boies, Schiller & Flexner LLP. Fritsch is known for his dirty tactics defending Plainfield after the media was questioning the ethics of the hedge fund leadership. In 2011 I published a story showing Max Holmes caught on camera encouraging his staff how to avoid possibly incriminating emails by cc’ing Fritsch on the communication to claim attorney client privilege.

Unlike investors, Sole and Fritsch who worked as senior executives at Plainfield through its hype and downfall should have some sense of what assets are being liquidating and judge what value they could fetch on the open market.

One institutional investor who received the Hudson Bay offer told this reporter in an email, “Needless to say as an LP I find this offer in extremely poor taste and offensive. Are Sole and Fritsch that desperate to make a buck that the only way they can do it is to use inside info to screw over LPs? Shameful.”

Fritsch and Sole did not return a request for comment at press time.
The same Plainfield investor said, “We don’t have any visibility/transparency from Plainfield to ascertain current value. Our firm wrote off significant amounts in prior years. This is a stub/residual piece. We didn’t even dignify the offer [from Hudson Bay] with a response.”

It’s unclear how many Plainfield investors took the Hudson Bay offer which expired on January 15th 2015.

Plainfield’s website says, “At the end of May 2012, Plainfield substantially completed the liquidation of the funds which it managed and deregistered, in good standing, from the S.E.C.” Legal filings in the Cayman’s obviously show there is more liquidation to be done. Why Marc Sole is now offering investors some discounted cash for the fund’s remaining investments is unclear.

Hudson Bay Offer Docs Plainfield 2008 Lidquidating LTD by Teri Buhl

Social Rejection?: Hedgie Steve Cohen Wants Out of East Hampton

The world’s most infamous trader wants to get out of East Hampton, NY. Yesterday I reported for the New York Observer that Stevie Cohen, of SAC Capital, is trying to broker a private deal to sell a $60 million ocean front home he bought less than a year ago. His reasoning, according to a person on the deal, is East Hampton is ‘too Jewish’ and he has instructed people to start looking for another home in other Hampton enclaves.

This one real estate transaction has fueled a social media debate about what he’s really doing. Having lived and worked among Cohen-ites and his SAC Captial traders for the last decade out in Connecticut’s gold coast I don’t think his comment is a signal of anything anti-Jewish. Instead I believe it shows his social network could be failing since the hedge fund he founded plead guilty to supporting a culture of massive inside trading.

Cohen paid the highest fees to broker dealers who moved his trades for over a decade but according to people who worked with him, starting from his early days a Gruntal & Co, they hated him because of the way he did business. I’ve been told stories of dealers at Lehman leaking other funds trade volume to Cohen and Cohen even funding smaller hedge funds to use them to create liquidity when he wanted to short a stock. The years of alleged cheating to beat the markets has left sour grapes in mouth of many on Wall Street. And now that he’s shutting down his large hedge fund his volume of fee paying to The Street will shrink. This could mean people aren’t as motivated to play friendly with the Cohens in their social time.

Stevie Cohen Family photo

Before we ran the story about why he wants to sell his East Hampton home I had multiple conversations with Cohen’s outside pressman (aka his block and tackle Flack) Jonathan Gashalter about what was going to be reported and he expressed anger at the idea we’d print the ‘too Jewish’ comment. He also would not go on the record to say neither house is up for sale before he went to print. No one knows what’s really in this hedgie’s mind when he said it and I’m sure Cohen never thought it would get repeated. Stevie Cohen has gotten stories held or changed for years through Gashalter but as the market ( and my peers in the media) are apparently waking up to how he operates it was refreshing to see the New York Observer stand by the news report and my reporting.

The news on anything Cohen, or what his family, does isn’t going to stop. Nick Verbitsky, director of Frontline’s new blockbuster film ‘To Catch a Trader’, told me the FBI even admitted that have three stock trades they are still investigating that could lead to criminal charges against Cohen. It’s my understanding one of them has a whistleblower willing to flip on Cohen; which is something we have yet to see in the DOJ’s seven plus years of trying to nail Cohen for inside trading.

Even if the DOJ is never able to get a criminal charge against Stevie, how the markets and his social network respond to what ‘they think’ he’s done is much more of a barometer for how The Street will or won’t police itself.

SEC Fines SAC’s Steve Cohen Millions but is Afraid to Say his Name

SAC Capital run by Greenwich hedge fund manager Stevie Cohen agreed to settle insider trading violations with the Securities and Exchange Commission yesterday for $614 million. The regulator amended its complaint from November 2012 when it sued a SAC trader Matthew Martoma for making triple digit millions off inside info on two drug stocks. Martoma who worked at a division of SAC Capital called CR Intrinsic was as arrested by the Justice Dept and faces years in jail. I talked about the new information in the SEC complaint with RT’s most popular TV host Max Keiser yesterday on a radio program. It’s a short fun 3 minute listen that you see here.

What I found most appalling about this settlement is the SEC lays out dates, times, and conversations that Stevie Cohen has with his employee about the inside information and then he trades on it to avoid millions in losses. Except the SEC won’t even directly name him in the lawsuit. Yep- they just call him portfolio manager A and add in one line at the beginning of the complaint that portfolio manager A is the founder and owner of SAC Capital. Who we all know is Steve Cohen of Greenwich, Conn.

Stevie laughing with wife Alex at the SEC

Stevie laughing with wife Alex at the SEC

The settlement has a ton of penalty fees in it and the SEC is flying their press flag touting it’s their largest insider trading settlement ever. But what kind of impact does this have on other participants in the market if they think you can just pay your way out of insider trading. Unlike Diamondback and Level Global, funds seeded by Stevie Cohen, who had to shut down from the stain of guilty inside traders at their firms; SAC Capital is business as usual. Cohen didn’t loose his securities license and he can afford the fine considering is net worth is now up to $9-10bn. His firm also doesn’t admit any GUILT.

It’s one of the biggest slaps in main street’s face because it shows if you’re the world’s most famous trader, and have enough money, you can just pay the government to allow you to inside trade.

Now the Justice Department has a bulls eye on Stevie Cohen and has tried to build a case to arrest him since 2006 and could still make an arrest. I mean the SEC’s case only flat out tells them how Stevie did the inside trade. But with the statute of limitations in these cases they only have till June this year to make a charge. Right now it’s looking like Stevie just bought himself a get-out-of-jail pass and he’ll be collecting more millions as he rounds GO.

New Stream Hedge Fund Executives Charged with Criminal Fraud

Today at 1pm in Hartford, Conn. federal court executives of Ridgefield-based hedge fund New Stream Capital were indicted on 19 counts of conspiracy, securities fraud and wire fraud. Tom Carson, DOJ pressman, confirmed the arrest of David A. Bryson and his co-founder Bart Gutekunst along with his CFO Richard Pereira last week. The case has been unsealed today. I first reported in 2009 the hedge fund was being investigated for investor fraud by the FBI at Hedge Fund Implode and continued to report on the fund’s bankruptcy and investor lawsuits for DealFlow Media and Forbes over the last two years.

The federal documents unsealed today also mentions a co-conspirator #2 labeled as a marketing and client relations person. This would be David’s sister, Tara Bryson, who I first reported was arrested for growing a pot farm in her Newtown, CT mansion with her boyfriend at Forbes. Tara Bryson went on to run a goat cheese farm and sell at local farmer markets in Fairfield County which include New Canaan. She was not charged with her brother today but did settle with the SEC in their civil suit against the fund for overvaluing assets and reaping millions in fees.

Also not in handcuffs today was Perry Gillies, the former GE executive and chief operations guy New Stream brought in to help communicate with investors and manage staff.

David and Bart used their homes as collateral for the $5 million bond. Rich, the CFO, only had to post a $300,000 bond. David’s wife Kristin Bryson was in court with him and does external public relations for IBM. The $3 million Bryson home in Ridgefield is up for sale – they bought it while David was running New Steam in 2006. All three plead not guilty and went home to their families in Ridgefield and Weston. The New Stream executives are facing over 100 years in jail if convicted on just five of the 18 counts of securities and wire fraud.

I’ve reported more on the history of New Stream, the names of funds that invested in New Stream, and how the investors led lawsuits built the government’s case for them at Growth Capitalist.

Hedgie Harassed by Pizzas also Managed Toxic CDO in DOJ’s S&P Lawsuit

Yesterday I reported on a New Canaan hedge fund manager who had a guy arrested for calling him multiple times saying he was a crook for working at Bear Stearns. The headlines were about some kind of harassment going on where the guy was obsessed with Higgins wife – who he use to date. I thought Higgins stalker was a bit off because Higgins actually left Bear Stearns in 2004 so how could he have helped caused their spectacular 2008 downfall. Well I might have been wrong about that.

Today in the DOJ civil fraud suit against the rater, S&P, we learn all about this $500 mn-ish asset backed CDO that was sold to a California credit union and blew up a year after S&P gave it a glowing buy signal. It was called Sorin VI Ltd and issued in March 2007. Well guess who picked the collateral that went into that CDO at the center of the DOJ’s lawsuit – non other than James Higgins firm Sorin Capital Management. And guess who the underwriter was…yep his buddies at Bear Stearns on the resi mortgage desk specifically Mike Neirenberg who ran the Alt-A desk.

Moody’s records show they started taking negative down grades on the toxic CDO Higgins managed in April 2008. His Bear Stearns buddy, Nierenberg, is one of the main traders in my big rmbs fraud story at The Atlantic that was also part of the Frontline Flim The Untouchables. I reported in May 2010 for The Atlantic analysts that worked for Nierenberg were told to make up loan level detail for the raters (like S&P) to get the bonds rated faster. Something that pretty much equals fraud.

Now this story gets even funnier because S&P thought the CDO was so screwed up – while they were rating it – that they even made a little song called ‘Burning down the House’ about it. FTAlphaville has some fun insight on the CDO and the suit today. The California credit union that bought $100mn of the CDO ended up loosing 90 percent of their investment, while Hedgies acting as collateral managers made some nice extra change ‘managing” the CDOs. And as long as they didn’t also own a tranche of the toxic stuff they took care of there wasn’t a lot risk for them.

New Canaan town records show 2008 was the year Higgins bought his huge spanking new mansion at 1480 Ponus Ridge Rd for near $8 million. Then at the end of the year he had to tell his investors his $1.5bn flagship fund was well…negative 36 percent.

Maybe Higgins alleged stalker, Donato Minicozzi, really did know something about how Higgins worked when he called to tell him “Bear Stearns Crook. Notre Dame Sucks. See you at South Beach.” But then this was a guy who threaten the millionaire by saying he’d send pizzas and girls to his house– so he might not be that clever.

Are the Feds Gunning for Civil RICO against Steven Cohen or SAC Capital?

The DOJ has a hard on for famed hedgie Stevie Cohen and the rest of the financial press has suddenly just figured this out. Cohen, a stock trader who founded Stamford-based SAC Capital, runs a trading company that is facing a pending SEC lawsuit. What the SEC would sue for we don’t actually know yet but my fellow journalist are speculating it’s for insider trading because six other people who once worked for Cohen have been arrested for such securities crimes.

I’ve covered Stevie Cohen since 2007 for Trader Monthly when we put him on a pedestal as a top 100 trader simply for the amount of money he made in a year. Cohen-ites (his loyal band of testosterone fueled stock jockey traders) live all around me in lower Fairfield County and I’ve interviewed countless people who have worked for him or are family related. The man has created a cult like mafia club who even when he kicks your rear out of his firm for one bad trade are still ultra loyal to him. I’m consistently told “No trader is ever going to try to cross Stevie Cohen”. So getting a trader like Mathew Martoma, who was arrested last week for one of the largest inside trading profits the DOJ has figure out yet,is going to be really tough for Federal prosecutors. I know as a fact Stevie became aware of the FBI investigating him personally for insider trading as far back as 2006 – based on conversations Stevie had with people I spoke with. That’s why we are seeing press reports about the number of compliance people he has at SAC because he amped up that division of the firm once he knew the feds were on to him.

The DOJ is playing a game of chicken with Cohen by throwing in a paragraph in their recent criminal case against a trader who worked from him saying ‘the hedge fund owner’ was on a call discussing getting out of the stock the Feds think was traded with inside info. There was really no legal reason to put that detail into the complaint since they haven’t charged Cohen but it’s clear they wanted the public to hear they are coming after him. Now nearly every one of the SAC traders I have spoken with simply think there is no way Stevie is that dumb to have a 20 minute conversation with Martoma that would included Stevie hearing Martoma say he wanted to get out of the trade because he was just leaked material non public information about a drug trial. In fact the person they think would be dumb enough to have that convo is the man who ran and partial owned CR Intrinsic Matt Grossman. Stevie is really slick about moving risk away from his direct line of fire and since the DOJ complaint doesn’t actually name who Martoma spoke with all we can do is speculate and hope the DOJ who is leaking a ton of info to reporters is telling the truth.

I only know of one sloppy practice Stevie has done in the past which could set him up for a co-conspirator in securities fraud – he would have weekly calls with traders who held large positions on Sunday nights to get a status of why they are in the trade. Cohen knew his traders used expert networks and according to firms that worked with SAC he encouraged his traders to use them. Still using an expert network isn’t illegal as long as you don’t get secret material non public info from them. That’s why I’m hearing from people who have been interviewed by the Feds about Stevie that a one time criminal charge for insider trading isn’t their goal. Instead it’s a non criminal suit–they want to charge him with Civil RICO.

Think about it – we know there is a pattern of behavior coming out of SAC Cap to get inside info to boost their trading gains. So if they want to get the leader of this pact why not try a suit that doesn’t need a full burden of proof jury to convict but just a majority who thinks he did this. They also need a pattern of about three crimes that followed the same amo and they basically already have that. With Civil RICO the DOJ can also go after Stevie’s personal assets if they can prove he bought them with money earned at SAC Capital. Given about half of the $14 billion in assets the firm manages are Stevie’s that sure gives the DOJ a big bucket of money to go after. The DOJ’s goal isn’t to get an inside trading charge on him with maybe a few years of jail time; they want to totally obliterate Cohen, shut down any chance of his trading again, and then take away his 36,000 sq ft palace in Greenwich and leave his wife Alex and daughters with nothing to live on.

Now this might be a pipe dream to the guys and gals running the DOJ financial fraud unit but I am quite confident after over six years of time and money spent on chasing Stevie Cohen they won’t give up with out a down and dirty fight. The problem is proving liability and their under paid lawyers and investigators have an uphill battle against the mind of Cohen and his cartel of other hedgies he’s helped turn into millionaires.

I hear of office bets at Wall Street firms setting up pools on if Cohen gets arrested and most are betting indicted but not convicted. That’s how much power and smarts they think this trading titan has. I have no doubt that Stevie started his career at Gruntal using inside info to make money — in court filings with his ex-wife’s lawsuit his attorney never argues Stevie didn’t inside trade on RCA they just claim she can’t sue for it because it’s past the statute of limitations. (Patricia Cohen’s suit against her ex-husband Stevie Cohen is still ongoing in NY State Appellate Court) But what I have doubt in is the DOJ’s ability to get the mafiosi informant type of evidence they’d need to nail him…and that’s just a sad fact of our justice system.

Greenwich Hedgie Max Holmes now wants to be a Media Titan

A Greenwich hedge fund manager who ran a multi-billion dollar fund is quitting trading to getting into the media business. Max Holmes of Plainfield Asset Management, who was widely reported for being under regulatory investigation, has called his new venture EcQuant. Holmes started winding down his asset-back fund a few years ago after gating his investors money during the financial crisis for over three years. Regulators were investigating the hedgie for charging excessive fees on overvalued assets but no charges have been brought so far.

Holmes, who is also a part time professor at NYU’s Stern School of Business, claims to have a nifty new software that will “change the face and bones of the News Media market”. But what this means is a mystery as the rest of the company description is a gobbly-guke of pr spin claiming EcQuant’s ’20 developers’ can create monetary value for media content–with out explaining how. They even claim to be hiring!

It’s unclear how Holmes little after-hedgie-life company was funded but I’ve previously reported for DealFlow Media that Holmes took home at least $50 million in fees while his fund was gated and his pension fund investors earned nothing. Hopefully he’ll be a little more diligent with his staff this time and not hold recorded town halls that teach his crew how to hide information from the SEC.

If your a new client of EcQuant we’d love to hear from you. Max wouldn’t return an email for comment but if you want to reach Holmes he’s now at: or you can stop by his office at 60 Arch Street (2nd floor) in Greenwich.