John C. Howe- Patriot Group -Old Hill Partners John C. Howe , Patriot Group and Old Hill Partners Members of John C. Howe's Patriot Group and Old Hill Partners May Be Complicit in Mr. Howe's Alleged Tax and Securities Frauds Darien Connecticut

Investor News asks where the other members of management were when Mr. Howe perpetrated his fraud shenanigans.

 If you haven't heard yet,  the tony southern Connecticut suburb of Westport,  full of many well-to-do executives and hedge fund groupies, is about to have one of its own go down in flames.   That person is John C. Howe,  the majority owner of several hedge funds who, along with those funds,  is under two investigations, one by the IRS for tax fraud, and the other by the SEC for securities law violations.   There are other possible charges against Mr. Howe for theft of client funds, and overcharging management fees to investors.

Most of Mr. Howe's private equity funds are registered with the SEC.

This column has done some research into the status of the John Howe cases and to identify the parties who are part of this alleged fraud scheme.

This case received traction during a Boston bankruptcy filing by Howe's Patriot Group LLC and two other creditors against a debtor who owes Patriot more than $20 million. 

During a deposition of the debtor,  the debtor's attorney notified the creditors' attorney and the bankruptcy trustee that the debtor was an IRS and SEC whistleblower. The whistleblower had filed claims against both Howe and his various funds, alleging they had committed tax fraud and violations of securities law. 

The debtor's attorney later notified the bankruptcy court of the whistleblower filing as part of a motion pleading. The details of the case and the types of alleged tax fraud have not been disclosed nor have copies of the actual whistleblower filings been made available to the courts. This column can only assume that the fraud allegations may involve all of Mr. Howe's funds along with John Howe and other officers, individually.  Whistleblowers International (WBI), a watchdog group in Europe,  has also done research and written several articles on this case.

As Sean Richards,  an investment advisor observes, "Once a company is charged with tax fraud or securities law violations,  it spreads like wildfire, implicating all of its members, officers, and affiliated entities."  If Richards is correct,  John Howe and his partners have plenty to worry about.

According to records files with the SEC,  Mr. Howe's entities provide a web of convoluted transitions including significant funds located in off-shore tax havens such as Grand Cayman and Bermuda,  both the recent targets of IRS and Congressional investigations.

One of Mr. Howe's funds that was involved in the bankruptcy litigation and was named by the debtor in the alleged tax fraud is Patriot Group, LLC,  located in Darien, Connecticut. Based on the most recently filed SEC records,  Patriot Group's members consist of John Christopher Howe, Robert Alan Deutsch, Jonathan Thomas Kane, Judith Tucker, and John Field.  

Old Hill Partners identifies Mr. Howe as its present and major investor, and Jeffrey M. Haas as its chief operating officer.

According to SEC files, Patriot was delisted from the SEC and was succeeded by Old Hill Partners Inc, in April 2013, right before engaging in the forced bankruptcy filing against the debtor.  According to Sean Richards,  "The delisting of Patriot Group right before a major event is suspicious and may indicate that Patriot was concerned about the legal implications from the anticipated whistleblower's filing.  I have seen cases where a perpetrator delists to reduce SEC focus on a sensitive matter, such as securities law violations."  

Sean Richards continues: "By delisting and having a successor entity (Old Hill Partners, in this example),  Patriot Group's previous alleged fraud and SEC violations do not go away."   

Other than Patriot Group,  Howe's funds consist of a series of U.S., Grand Cayman and Bermuda funds, all linked by common owners, investors, officers and, Howe, himself.   There is the  Washington Special Opportunity Fund, Inc., a Cayman Island corporation, the Washington Special Opportunity, LLC, a Delaware limited liability company, PFM Credit Recovery I, LLC and a Delaware limited liability company, and another off-shore Bermuda fund, the OHP Opportunity Limited Trust. There are other funds that are not identified in this column which  the reader can find through the SEC's web site as www.SEC.gov.