Yorkville Advisors LLC and two of its top officials were sued by the U.S. Securities and Exchange Commission for allegedly inflating the value of securities held in hedge funds managed by the firm.
Yorkville, its founder and president, Mark Angelo, 40, and Chief Financial Officer Edward Schinik, 47, reported inflated values for convertible debentures, convertible preferred stock and promissory notes held by the hedge funds since at least 2008, the SEC claimed in a complaint filed today in Manhattan federal court.
Yorkville, a Jersey City, New Jersey-based investment adviser, made more than $10 million in fees from the overstatements, according to the SEC. Yorkville also misled investors about its risky and illiquid investments from April 2008 to January 2010, the SEC said.
The agency is seeking disgorgement of unspecified gains to Yorkville, civil penalties and an order barring the defendants from violating securities laws in the future.
A call to Yorkville seeking comment on the SEC allegations wasn’t immediately returned.
The case is Securities and Exchange Commission v. Yorkville Advisors LLC, 12-CV-7728, U.S. District Court, Southern District of New York (Manhattan).
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