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Orca Funds - Currency Futures (fraudulent)

2002-09

Count of distinct funds: 1
Capital base: ?
Loss: ?

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stories: cftc.gov

This narrative contributed by Ann Logue.

In January of 2001, Donald O'Neill told investors that he was running a hedge fund that specialized in trading foreign currency futures contracts. He attracted some big institutional accounts, including the Fort Mojave tribe and the Hopi Tribal Housing Authority. Then, he took $10.6 million of the money that he raised and spent it on a lavish house in Florida and trips to Las Vegas. He wasn't much of a gambler, either, losing $800,000 at the casinos. Naturally, O'Neill faked account statements from fictitious brokerage firms rather than admit what he had done. By the summer of 2002, though, the Commodity Futures Trading Commission caught up with him.

The Commodity Futures Trading Commission weighed in on the case here.

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Important: This fund is on our list of hedge funds that have "imploded" (see also ailing lenders). However, please note that "imploded" is a somewhat subjective. The "imploded" list contains hedge funds (or other unregulated and autonomous speculative investment funds) which have gone through some sort of permanent adverse change. This is a somewhat subjective call, and does not necessarily mean total shutdown or bankruptcy. It can also mean steep and rapid mark-downs in net asset value; or abnormal "bail-out" by corporate parents or peers in order to avoid write-downs and provide liquidity. The funds are of any type and sector.