Posted on 08/26/2005 1:21:40 AM PDT by snowsislander
Law-enforcement officials believe hundreds of millions of dollars may be missing from a Connecticut hedge-fund firm that unexpectedly told its investors it was closing last month, a person briefed on an investigation into the matter said.
The firm, Bayou Securities LLC, earlier this year reported to investors that it had assets of $440 million. Last year, it told investors that it had more than $500 million in assets. A person familiar with the firm's accounts said that assets had "petered out" in the past 18 months, and that there had been markedly less trading in that time after years of rapid-fire buying and selling.
Even before Connecticut authorities said they were investigating the firm this week, investors were shocked by a July 27 letter from its founder, Samuel Israel III, announcing that what he called the Bayou Family of Funds would return their money and shut its doors.
Mr. Israel, 46 years old, said in the letter, reviewed by The Wall Street Journal, that his decision was prompted by family troubles. "I am currently in the process of getting divorced," he wrote, adding that he wanted to spend more time with his children so he could watch them grow up. "The opportunity to share in this miracle is not one that I plan to miss," he said.
He added that he wanted to spend time "relaxing and enjoying my children and focusing on rebuilding my personal life." But he said he would continue to trade with his own money, along with that of his business partner, Daniel Marino, to "keep a toe in the business which I love too much to give up entirely."
In another letter, dated Aug. 11, Mr. Israel said investors would get 90% of their money back the following week and the rest by the end of the month. ...
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(Excerpt) Read more at wsj.com ...
is that quarterback Dan Marino?
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