Hedge Funds

SEC nabs fraudulent hedge fund manager in Kansas


The Securities and Exchange Commission has frozen the assets of a Wichita, Kansas man who masqueraded as a hedge fund manager while spending his clients' money on personal expenses.

Scott Kaye raised $1.9 million from 18 investors for a sham hedge fund operation called TrueHedge Advisors, LLC, from June 2002 through February 2003, according to the SEC's complaint. Kaye's private placement memorandum told his investors their money would be put into a hedge fund that would invest in stocks and options, but instead he misappropriated more than a third of the money, according to the complaint. Kaye spent the