Former hedge fund manager indicted for fraud

The former head of a Hailey, Idaho-based hedge fund was indicted on criminal charges that he carried out a fraudulent scheme that bilked investors out of $88 million, the U.S. Attorney's office said yesterday.
FEB 02, 2007
The former head of a Hailey, Idaho-based hedge fund was indicted on criminal charges that he carried out a fraudulent scheme that bilked investors out of $88 million, the U.S. Attorney's office said yesterday. John H. Whittier, Wood River Capital Management LLC 's majority shareholder and principal executive, was charged with securities fraud and failure to disclose beneficial interest of 5% of more in a publicly traded security, according to the U.S. Attorney for the Southern District of New York. He also faces two counts for allegedly failing to disclose a beneficial interest of 10% or more in a publicly traded security. Mr. Whittier is expected to be arraigned on Feb. 8. The Securities and Exchange Commission filed charges against Mr. Whittier and Wood River in October 2005, alleging that the company misrepresented the management styles of two of Wood River's funds and failed to disclose concentrated holdings in one stock. Prosecutors alleged that Mr. Whittier schemed to defraud investors in Wood River Partners LP and Wood River Partners Offshore Ltd. hedge funds by acquiring ownership of approximately 80% of the common stock in EndWave Corp., a wireless communications company, without disclosing ownership as required by the SEC. The shares were accumulated between late 2004 and September 2005.

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