US authorities have clamped down on fraud and illicit operations in 2019. With sharpened teeth, a federal judge has just slapped a 40-month jail sentence on Jeremy Shor, a former trader at now-defunct hedge fund Premium Point Investments, per a Bloomberg report.
A conviction was handed down to Shor following his collusion with the group’s co-founder, Anilesh Ahuja. The prosecution had focused on overvalued assets to help bring in new investors and retain clients.
Amongst several levied charges, Premium Point Investments had wrongfully jacked-up investment fees, while actively curtailing efforts to withdraw funds.
Steep jail sentence
The jail sentence follows on the heels of a conviction last July for Shor, along with Premium Point co-founder Anilesh Ahuja. Ahuja’s sentencing will take place soon, possibly as early as next week.
By extension, Premium Point’s former portfolio manager, Amin Majidi, had also been convicted of setting inflated monthly targets for returns. Subsequently, he had ordered Shor and other traders to manipulate the valuations.
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This level of abuse is hardly an exception, though US authorities have clearly come down hard on the convicted, with a 3.5-year jail sentence reflecting substantial jail time.
This stance was echoed by prosecutors who had specifically requested US District Judge Katherine Polk Failla to sentence Shor to more time behind bars for having such an instrumental role in the scheme. Court probation officials had originally recommended a term of only three years.
A new example to follow for fraudsters?
For his part, Shor claimed he should have raised questions about the valuations of the firm’s assets. Not doing so “has left me with an indescribable pain and sense of failure I will feel for the rest of my life.”
In recent years, federal prosecutors have brought a number of mismarking cases against several firms and individuals. These sentences seldom have breached an 18-month period of jail time, making this case possibly an example to follow moving forward.
The latest sentencing caps off a saga lasting over a year. Premium Point’s mortgage-credit funds had for bankruptcy protection from creditors as far back as March 2018. Ahuja, Majidi, and Shor were charged just two months later.