The
Regulators further charged that the Nevis Funds exceptional cumulative returns of 90.1%, 154.6% and 286.5% as of May 31, 1999, Sept. 30, 1999 and Dec. 31, 1999 would actually have been negative 5%, negative 3.6% and 41% without its IPO holdings. These padded returns netted Nevis Capital $2.6 million in fees, the SEC said. Nonetheless, the firm misrepresented the reason for the funds returns as its "long-term investment strategy" in its prospectus and advertisements, rather than its IPO holdings, the SEC said.
The SEC plans to hold a hearing to determine whether these allegations are true.