sec-litreleases litigation_release 64 KB 2,132 chars

SEC v. Angelo Haligiannis; Sterling Watters Group LP; Sterling Watters Capital Advisors, LLC; and Sterling Watters Capital Management, Inc., No. LR-18831, Southern District of New York — Press Release

raw: Haligiannis, et al.

Haligiannis, et al., No. LR-18831 (S.D.N.Y.)

Caption: SEC v. Angelo Haligiannis, et al.

summary

Angelo Haligiannis and his hedge fund, Sterling Watters Group LP, along with its general partners, defrauded investors of at least $27 million since 1996 by fabricating performance data, falsely claiming $180 million in assets and 1,500% returns, leading to an SEC emergency action, asset freeze, and pending litigation.

paragraph

The SEC charged Angelo Haligiannis, Sterling Watters Group LP, and its general partners with defrauding investors of at least $27 million by distributing fake account statements and marketing materials that falsely reported $180 million in assets and over 1,500% returns since 1996. In reality, the fund had lost money and was essentially worthless, with investors misled into maintaining or increasing their investments. The defendants were charged with violations of Section 17(a) of the Securities Act, Section 10(b) and Rule 10b-5 of the Exchange Act, and Sections 206(1) and 206(2) of the Investment Advisers Act, prompting a court-ordered asset freeze, verified accounting, and expedited discovery.

narrative

The SEC filed an emergency enforcement action against Angelo Haligiannis, Sterling Watters Group LP, and its general partners for orchestrating a long-running fraud that began in 1996 and defrauded investors of at least $27 million. Haligiannis and his entities systematically fabricated quarterly and annual account statements and marketing materials, falsely claiming the fund had $180 million in assets and generated over 1,500% cumulative returns, when in fact the fund had lost money and was essentially worthless. These deceptive materials were used to lure new investors and retain existing ones, with phony statements sent as recently as two weeks before the SEC’s action. The SEC charged all defendants with violations of Section 17(a) of the Securities Act of 1933, Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934, and the general partners with breaches of fiduciary duty under Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. Upon the SEC’s application, the U.S. District Court for the Southern District of New York issued a temporary restraining order, froze all defendants’ assets, and ordered a verified accounting and expedited discovery. The litigation remains pending as the court continues to assess the full scope of the fraud and potential remedies for harmed investors.

Enriched metadata

Scheme: unregistered-securities (100%)
Court: Southern District of New York
Entity: Sterling Watters Group LP

Classified unregistered-securities(confidence 100%). EDGAR detection: forms Form D/S-1· recall 41% / precision 30%. detection rule →

Extracted insights

Dollar amounts 2

$180.00M $180 million $100M–$1B
$27.00M $27 million $10M–$100M

Entities 1

organization The Commission

Triples 4

The Commission filed an emergency enforcement action against Angelo Haligiannis and Sterling Watters Group LP
The complaint alleges the Defendants have systematically been defrauding investors who purchased limited partnership interests in Sterling Watters
Haligiannis has raised at least $27 million in the Fund since 1996
The Defendants have been defrauding investors who purchased limited partnership interests in Sterling Watters

View original SEC litigation releasesec.gov

Extracted body text (2,132c)

SEC v. Haligiannis, et al., 04 CV 06488 (RJH) (S.D.N.Y.) The Commission announced today that it filed an emergency enforcement action yesterday against Angelo Haligiannis and Sterling Watters Group LP (the "Fund"), a hedge fund, as well as the Fund's general partners, Sterling Watters Capital Advisors, LLC, and Sterling Watters Capital Management, Inc. (the "Defendants"). The complaint alleges that the Defendants have systematically been defrauding investors who purchased limited partnership interests in Sterling Watters. Since 1996, Haligiannis has raised at least $27 million in the Fund by grossly misrepresenting the Fund's performance to investors and potential investors. Haligiannis and Sterling Watters distributed to investors phony account statements that recorded fictitious quarterly and annual investment gains and account balances. Haligiannis and Sterling Watters also inflated Sterling Watters investment returns in marketing materials in an effort to induce investments in Sterling Watters. For example, Haligiannis provided investors marketing materials that falsely claimed that the Fund had $180 million in assets and had achieved returns of over 1,500 percent since inception. As recently as two weeks ago, Sterling Watters sent investors quarterly account statements that showed an aggregate of tens of millions of dollars of investor equity in the fund. In fact, the Fund's brokerage records show that the Fund has lost money over the years and is now essentially worthless. The Complaint charges violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder by all Defendants, and violations of Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 by Haligiannis and the Fund's general partners. Upon the Commission's application, the United States District Court for the Southern District of New York yesterday entered a temporary restraining order and an order freezing the Defendants' assets. The Court also ordered a verified accounting from all Defendants and expedited discovery. The litigation is pending.

OCR text (2,132c · plain-text · 99% conf)