Free Republic

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...

NEW YORK (Reuters) - Law-enforcement authorities are investigating whether funds are missing from a money-management firm, Bayou Securities LLC, that claimed to be overseeing $440 million in investments, the Wall Street Journal reported on Thursday. The newspaper, citing people familiar with the matter, said the Connecticut Department of Banking is looking into the company, which is based in Stamford, Connecticut. Federal prosecutors also are investigating, a person familiar with the matter said. A spokesman for the Securities and Exchange Commission declined to comment to the newspaper. The Journal said red flags went up in recent weeks when some investors...