According to Dealbreaker’s Matt Levine Peter Eichler and his
firm Aletheia Research and Management seem to have had a good run; Aletheia
managed $10 billion and per DealBook “Mr. Eichler’s stellar investment
performance attracted the likes of Goldman Sachs and Morgan Stanley, which
entrusted him with millions of dollars of their clients’ money.” But now that
Aletheia is in bankruptcy everyone’s a critic, and the latest SEC’s complaint
makes Aletheia out to be a garden-variety bucket shop with no evident investing
abilities.
The SEC’s main complaint here is that Eichler, the sole and
unsupervised options trader – and, apparently, everything trader – at the firm,
made lots of options trades that he didn’t allocate for an hour or more after
making them. Winning trades were allocated to his personal accounts or those of
his friends and employees; losing trades were allocated to the accounts of two
in-house hedge funds. There were varying degrees of blatancy here, with the
worst being 463 trades allocated after the positions were closed, which returned
11% to favored customers, 17% to Aletheia insiders (including 19% to Eichler’s
personal account), and negative 1.7% to the in-house hedge funds….
No comments:
Post a Comment