• Report: #957582
Complaint Review:

Stephen Hicks / Southridge Capital

  • Submitted: Sat, October 20, 2012
  • Updated: Sat, October 20, 2012

  • Reported By: Xiao — Other United States of America
Stephen Hicks / Southridge Capital
Internet United States of America

Stephen Hicks / Southridge Capital Southridge Partners Fraud, Scam, Sued by SEC www.southridge.com, Internet

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The Securities and Exchange Commission charged that fund manager Stephen Hicks, manager of Southridge Capital and fund manager Yorkville Advisors, its founder and president Mark Angelo, and chief financial officer Edward Schinik engaged in a fraudulent scheme to inflate the value of assets in its portfolio.The firm is denying the allegations and claims that the SEC's is "driven by an agenda."The charges were brought against Jersey City, N.J.-based Yorkville, Angelo, 40, and Schinik, 47, in U.S. District Court in Manhattan. Yorkville, which registered as an investment adviser with the SEC in June, claimed to have as much as $1 billion in assets under management. The firm has been one of the most active private placement investors over the past
decade. Yorkville has invested at least $4.23 billion in 364 PIPEs since 2001.

The SEC alleges that Yorkville, Angelo, and Schinik enticed pension funds and other investors to put money into their hedge funds by falsely portraying Yorkville as a firm that managed a highly-collateralized investment portfolio and used a robust valuation procedure.The SEC said in a statement that this is the seventh case that has arisen out of its Aberrational Performance initiative begun in 2011 by the SEC Enforcement Division's Asset Management Unit. The unit uses proprietary risk analytics to identify hedge funds with suspicious returns, the SEC said."The analytics put Yorkville front and center on our radar screen," said
Bruce Karpati, chief of the Enforcement Division's Asset Management Unit, in the statement. "When we looked further we found lies to investors and the firm's auditors as well as a scheme to inflate fees by grossly overvaluing fund assets. We will continue to pursue hedge fund managers whose success is based on fiction rather than fact."The Asset Management Unit has also brought cases against Lawrence Goldfarb of BayStar Capital Management; Stephen Hicks, manager of Southridge Capital; Corey Ribotsky, manager of The N.I.R. Group; PEF Advisers; Vision Capital; and RAM Capital.


This report was posted on Ripoff Report on 10/20/2012 09:44 AM and is a permanent record located here: http://www.ripoffreport.com/reports/stephen-hicks-southridge-capital/internet/stephen-hicks-southridge-capital-southridge-partners-fraud-scam-sued-by-sec-wwwsouthr-957582. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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