Quant Hedge Fund Adviser Alleged to Have Committed Fraud

October 31, 2011

The SEC charged Andrey C. Hicks of Boston, Massachusetts, and Locust Offshore Management, LLC, his investment advisory firm, with committing fraud in connection with misleading prospective investors about their supposed quantitative hedge fund.

The SEC stated that Hicks diverted investor money to his personal bank account. The SEC alleges that Hicks and his advisory firm made misrepresentations about his education, work experience, and the hedge fund’s auditor, prime broker/custodian, and corporate status when soliciting individuals to invest in the purported hedge fund, called Locust Offshore Fund, Ltd.  By making these representations and creating other indicia of legitimacy, the SEC stated that Hicks may have obtained at least $1.7 million from 10 investors and may have misappropriated at least a portion of these funds for personal expenses.

Click here to access the administrative action.


Enforcement Actions, Investment Advisers, Investment Companies