Hedge-fund honchos trial begins in B’klyn
Three hedge fund managers went on trial Tuesday in Brooklyn Federal Court for defrauding investors out of millions of dollars.
Former head of Platinum Partners’ billion dollar hedge-fund, Mark Nordlicht; his co-chief investment officer and former right-hand man, David Levy; and Joseph SanFilippo, who managed the fund’s finances, are accused of scamming dozens of investors out millions over the years.
“This is a case about deceit and greed,” Assistant U.S. Attorney Patrick Hein said in his opening statement. “[The defendants] managed a billion-dollar hedge fund firm called Platinum. They are here today because they lied to their investors in order to pocket millions and millions of dollars.”
Hein said the trio lied about the fund’s health so people would keep investing.
The prosecutor said emails and recorded phone calls, in which the three men can be heard referring to the situation as “Hail Mary time” and “code red,” will show jurors they were fully aware of the grim financial forecast.
“They put themselves first and investors last,” Hein said. “Things got worse and worse for them, and by 2014, they were in deep trouble.”
Defense attorneys, two of whom delivered opening statements Tuesday, characterized the trial itself as a “fraud” and told jurors Platinum’s “sophisticated” investors were always aware of the risks — as evidenced by their signature beside the terms and conditions.
Nordlicht’s lawyer Jose Baez, who is also representing disgraced film producer Harvey Weinstein in his upcoming Manhattan trial, told the jury Nordlich has waited a long time to “clear his name” “This is ... big business,” he said. “You have to have a certain level of sophistication when it comes to investing.”
Baez then advised jurors that if they can’t understand what’s going on, they should free his client: “If you don’t understand it, if it gets too complex, you have to acquit.”