The perils of Perry

Wed Mar 1, 2006



A trade that has been practiced quietly for years comes under SEC scrutiny

Pity poor Richard Perry. With his Goldman Sachs pedigree, the 50-year-old manager - and the eponymous firm he has steered so successfully for 18 years - definitely count among the legendary hedge fund elite. That said, it may seem surprising, even somewhat shocking, that Perry Corp. and its founder are in the crosshairs of the U.S. Securities and Exchange Commission.

But that's exactly where Perry finds himself these days: on the verge of having a civil enforcement action filed against him and his fund for alleged fraud related to trading in shares of Mylan Laboratories in 2004. To add insult to injury, Perry funds are also coming off one of their worst annual performances ever. Last year, Perry Partners, his onshore fund, returned about 5.5%, and Perry Partners International, the offshore vehicle, returned about 3.2%, according to investors....

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