by John Darer
A Jersey City hedge fund that catered to "smaller " investors and "mom and pops" and reportedly ranked third out of 3,527 top perforrming global hedge funds in April 2010 Bloomberg data, is now defunct as authorities now say Osiris Fund LP was little more than an elaborate fraud run by a three-time convict who had been expelled from the securities industry 20 years ago.
A lawsuit was filed in Hudson County Superior Court alleging:
- The fund’s offering documents failed to disclose Zuck’s criminal background, which included a five-year prison sentence handed down for securities fraud and corporate misconduct.
- The documents did disclose that Osiris clients would be charged a management fee equal to 3 percent of the value of the fund’s net assets. But unbeknownst to them, the firm soon began overstating this net asset value, allowing it to extract higher fees from clients, officials wrote.
- Then, in April and May of 2010, Osiris incurred massive trading losses of about $4.52 million, or around 50 percent of the fund’s value at the time (amazing when you consider its published ranking in the same month!). But rather than admit these losses to investors, state officials said, Osiris’s executives instead falsified account statements sent to investors by adding a fictitious $5 million asset to the fund’s holdings.
Copy of verified complaint in Chiesa/ Tiger v Peter Zuck et al. Superior Court of New Jersey Chancery Division Hudson County Docket C-125-12
With a structured settlement nobody can steal your money. As part of the structured settlement protection acts in effect in mosts states, to liquidate structured settlement payment rights a judge must approve the transaction as being in your best interest.
However, this story is gives another example of why some sort of registration should be required of those who sell acquired structured settlement payment rights to individual investors. I previously reported in "Where Is "Structured Settlement Legend" of 2010? Solicitor of "Average Joe" is "MIA" about a peddler of structured settlement payment rights who is now missing in action.