Hedge fund investor sues Citi Alternatives, alleging fraud


A wealthy investor in Boca Raton, Fla., has sued Citigroup Alternative Investments, alleging that the firm failed to properly disclose the risks in a fixed-income hedge fund that suffered big losses in last year’s second half.

In an 18-page complaint filed on April 4 in the U.S. District Court for the Southern District of Florida, the plaintiff accuses Citigroup Alternatives of marketing Falcon Strategies Two B, a multistrategy fixed-income fund managed by Reaz Islam, as having low risk and low volatility, and then defrauded investors by failing to disclose its change to a “far riskier investment strategy.”