United States Attorney
Southern District of New York
Tuesday, July 17, 2012
Hedge Fund Principal Charged in New York Federal Court with Securities Fraud, Investment Adviser Fraud and Wire Fraud
Chetan Kapur, the sole managing principal of ThinkStrategy Capital Management LLC, was charged in a seven-count indictment with securities fraud, investment adviser fraud and wire fraud, announced today Preet Bharara, the U.S. Attorney for the Southern District of New York, and Janice K. Fedarcyk, the Assistant Director-in-Charge of the New York Field Office of the FBI. He was arrested and presented today in New York federal court before U.S. Magistrate Judge Frank Maas.
According to the indictment unsealed today:
Kapur was the sole managing principal of ThinkStrategy Capital Management LLC, a Delaware limited liability company with its principal place of business located in New York, New York. Kapur managed and advised two hedge funds that each utilized two share classes: ThinkStrategy Capital Fund-A and ThinkStrategy Capital Fund-B, collectively, the ThinkStrategy Capital Fund, and TS Multi-Strategy Fund-A and TS Multi-Strategy Fund-B, collectively, the ThinkStrategy Multi-Strategy Fund.
In connection with the marketing and management of the ThinkStrategy Capital Fund and the ThinkStrategy Multi-Strategy Fund, Kapur and ThinkStrategy deceived investors by making false and misleading statements and material omissions, and also by disseminating false and misleading information to the investors. The information included misrepresentations about the prior and current performance, longevity, assets, personnel, and due diligence of ThinkStrategy’s managed funds.
The indictment charges Kapur, 37, of New York, with one count of securities fraud, one count of investment adviser fraud and five counts of wire fraud. He faces a maximum sentence of 125 years in prison. Kapur’s next appearance is scheduled for July 25, 2012 at 10:30 a.m. before U.S. District Judge John Keenan.
U.S. Attorney Bharara praised the investigative work of the Federal Bureau of Investigation. He also thanked the U.S. Securities and Exchange Commission’s Asset Management Unit for their assistance.
This case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed more than 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,700 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
This case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Bonnie Jonas and Marissa Molé Bostick are in charge of the prosecution.
The charges contained in the indictment are merely accusations and the defendant is presumed innocent unless and until proven guilty.