Chicago-based investment adviser Neal Goyal has been charged with defrauding at least 35 investors out of more than $11.4 million in a Ponzi scheme. (May 28, 2014)
The Securities and Exchange Commission has accused Chicago-based investment adviser Neal Goyal of defrauding at least 35 investors out of more than $11.4 million in a Ponzi scheme.
A suit filed Wednesday in Northern District Court alleges that Goyal, who owns Blue Horizon Asset Management LLC and Caldera Advisors LLC never invested the vast majority of the money he raised from investors and the limited trading he did, resulted in losses.
The SEC also alleges that Goyal used the funds to support his lavish lifestyle and pay business expenses, including a staff trip to the Caribbean, a $1.4 million home and funding for his wife Marti’s clothing boutique, Urba Baby.
The boutique’s Lincoln Park location closed Tuesday, while the Wicker Park location, on Division St. remains open.
According to the suit, Goyal raised more than 7.3 million on behalf of the Blue Horizon Funds between January 2007 and May 2014. Caldera’s other investment vehicle, known as the Caldera Fund, raised at least $3.2 million from investors until February.
The suit alleges that Goyal employed what is known as a “long-short” trading strategy, meaning that the funds would purchase certain equity securities while selling short other equity securities.
The suit claims that Caldera represented that the funds consistently outperformed the stock market.
The suit alleges that Goyal created and sent investors fictitious account statements for the funds they invested in. In 2007, when investors sought to cash out of the fund, the SEC claims that Goyal made payments to investors based on inflated amounts represented in account statement.
The SEC is requesting a jury trial and that Goyal return the money to investors and appropriate penalties.
Goyal, nor his wife, could not immediately be reached for comment. His attorney, Howard Rosenburg, said that Goyal "has been cooperating with the SEC since the beginning of its inquiry and he expects to continue to cooperate.”
A suit filed Wednesday in Northern District Court alleges that Goyal, who owns Blue Horizon Asset Management LLC and Caldera Advisors LLC never invested the vast majority of the money he raised from investors and the limited trading he did, resulted in losses.
The SEC also alleges that Goyal used the funds to support his lavish lifestyle and pay business expenses, including a staff trip to the Caribbean, a $1.4 million home and funding for his wife Marti’s clothing boutique, Urba Baby.
The boutique’s Lincoln Park location closed Tuesday, while the Wicker Park location, on Division St. remains open.
According to the suit, Goyal raised more than 7.3 million on behalf of the Blue Horizon Funds between January 2007 and May 2014. Caldera’s other investment vehicle, known as the Caldera Fund, raised at least $3.2 million from investors until February.
The suit alleges that Goyal employed what is known as a “long-short” trading strategy, meaning that the funds would purchase certain equity securities while selling short other equity securities.
The suit claims that Caldera represented that the funds consistently outperformed the stock market.
The suit alleges that Goyal created and sent investors fictitious account statements for the funds they invested in. In 2007, when investors sought to cash out of the fund, the SEC claims that Goyal made payments to investors based on inflated amounts represented in account statement.
The SEC is requesting a jury trial and that Goyal return the money to investors and appropriate penalties.
Goyal, nor his wife, could not immediately be reached for comment. His attorney, Howard Rosenburg, said that Goyal "has been cooperating with the SEC since the beginning of its inquiry and he expects to continue to cooperate.”
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