Lake Shore Asset Management, a Chicago-based hedge fund, had $288 million of its assets frozen by a federal court last week, after regulators stated it overstated its holdings, according to Bloomberg News.   Lake Shore is run by Laurence Rosenberg, former chairman of the Chicago Mercantile Exchange, and manages $1 billion for investors and trades U.S. commodity futures contracts, according to Commodity Futures Trading Commission.   A review of the fund showed that it had $466 million. The fund banned regulators from inspecting its accounts on June 14, which is a violation of the Commodity Exchange Act, according to the commission’s complaint. Lake Shore is a commodity pool operator, an investment group that seeks to aggregate money to trade futures and options on commodities and other financial instruments.   The commission’s complaint contends that Rosenberg and other employees at the fund gave inconsistent statements to regulators regarding the fund’s activity and that it has refused to make documents available to the agency.   On June 14, Rosenberg allowed the National Futures Association to review Lake Shore’s protected website, where it found that the fund had $466 million in managed accounts, “dramatically less then Rosenberg’s estimate that it had approximately $1 billion under management,” the commission said.   A hearing is scheduled for July 11, the commission said.   Judge Blanhce Manning of the Federal District Court in Northern, Ill., granted the commission’s request to freeze the funds assets and to prevent it from destroying documents related to the inquiry, according to a court filing dated June 27, 2007.   Lake Shore “has engaged, is engaging in and is about to engage in violations of the Commodities Exchange Act, Judge Manning ruled.   The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.

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