Hedge Funds

Red Coat investors allege fraud in latest suit

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Angry investors in $400 million Red Coat Capital Management, including Alpha Investment Management CEO Nate Gantcher, are suing Red Coat and its founders, Ken Londoner and George Hodor, for fraud, breach of fiduciary duty, and breach of contract. They claim the pair funneled money from the fund into their personal accounts, made huge and risky bets on sketchy stocks, and hid the extent of the losses.

The complaint, filed in New York State Supreme Court, also claims the Red Coat managers made "unsuitable and unreasonable" investment decisions for the funds by over-concentrating them in one or two high-risk