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New York-area hedge fund manager charged with Ponzi fraud

New York-area hedge fund manager charged with Ponzi fraud
From Reuters - October 5, 2017

NEW YORK (Reuters) - A suburban New York hedge fund manager accused of losing or spending all but about $27,000 of the $21.8 million he told investors he had was criminally charged on Thursday with running a Ponzi scheme.

Prosecutors said Michael Scronic, who once worked at Morgan Stanley (MS.N) and has degrees from Stanford University and the University of Chicago, stole more than $19 million from 45 investors he had lured to his Scronic Macro Fund by lying about his track record.

Scronic, 46, of Pound Ridge, New York, allegedly lost money in 28 of 29 calendar quarters since April 2010, even as he reported largely positive returns on bogus account statements.

Prosecutors said he also spent $2.9 million on himself over 5-1/2 years, including $180,000 annually on credit cards, fees for beach and country club memberships, and mortgage payments for a vacation home near Stratton Mountain in Vermont.

Scronic was criminally charged with one count each of securities fraud and wire fraud.

He was released on $500,000 bond after a brief appearance in the federal court in White Plains, New York, and is forbidden from trading other peoples money or raising new funds.

The U.S. Securities and Exchange Commission filed related civil charges.

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