(MENAFN- ValueWalk)
Free-Photos / Pixabay
Four United Development Funding (UDF ) executives have been sentenced to a combined 20 years in federal prison for fraud, announced U.S. Attorney for the Northern District of Texas Chad E. Meacham.
UDF Executives Sentenced
In January, a federal jury convicted UDF CEO Hollis Morrison Greenlaw, UDF Partnership President Benjamin Lee Wissink, UDF CFO Cara Delin Obert, and UDF Asset Management Director Jeffrey Brandon Jester of ten counts, including conspiracy to commit wire fraud affecting a financial institution, conspiracy to commit securities fraud, and securities fraud. They were sentenced today by U.S. District Judge Reed C. O'Connor.
Get Our Activist Investing Case Study!
Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below!
Q1 2022 hedge fund letters, conferences and more
London Value Investor Conference 2022: Chris Hohn On Making Money And Saving The World
Chris Hohn the founder and manager of TCI Fund Management was the star speaker at this year's London Value Investor Conference, which took place on May 19th. The investor has earned himself a reputation for being one of the world's most successful hedge fund managers over the past few decades. TCI, which stands for The Read More
Mr. Greenlaw was sentenced to seven years in federal prison; Mr. Wissink to five years; Ms. Obert to five years; and Mr. Jester to three years. The judge also ordered Mr. Greenlaw, Mr. Wissink, and Ms. Obert to pay fines of $50,000 each.
“UDF executives comingled funds, shuffling money from one fund to another without disclosing their actions to investors or regulators,” U.S. Attorney Chad Meacham said following the verdict.“The Northern District of Texas has always been tenacious in its pursuit of white collar criminals and this case is no exception. We were proud to bring these defendants before a jury and are pleased that the judge saw fit to sentence them to a lengthy prison term.”
“Today's sentences reaffirm the FBI's commitment to hold executives accountable for engaging in corporate fraud and defrauding investors. We will continue working with our partners to investigate anyone that attempts to manipulate investment funds for their own personal benefit,” said Matthew DeSarno, Special Agent in Charge of the FBI's Dallas Field Office.“Our agents, analysts, and forensic accountants dedicated years to ensuring this investigation was done with the utmost precision. It is the reason why these defendants will now spend years in federal prison.”
According to evidence presented at trial, the defendants orchestrated a scheme to mislead investors and the SEC about their funds' performance.
Founded in 2003 and headquartered in Grapevine, UDF utilized a family of five funds – UDF I, II, III, IV, and V – to invest in various residential real estate developers and private homebuilders.
When developers failed to repay money they borrowed from one fund, triggering multi-million dollar shortfalls, the defendants transferred money out of another fund in order to pay distributions to the original fund's investors , all without disclosing the transfers to the SEC and the investing public.
The Federal Bureau of Investigation's Dallas Field Office conducted the investigation. Assistant U.S. Attorneys Tiffany H. Eggers (NDTX Criminal Chief), Rachael Jones, Elyse Lyons, and Errin Martin prosecuted the case.
Updated on May 23, 2022, 12:00 pm
MENAFN23052022005205011743ID1104260499
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.