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Trabulse founded the fund in 1997 and raised $10 million from 100 investors.
“Trabulse betrayed the trust investors placed in him by fabricating performance figures and treating the hedge fund as if it were his own personal bank account,” said Linda Chatman Thomsen, director of the SEC’s division of enforcement. “The commission is determined to hold hedge fund managers accountable when they deceive investors.”
Helene L. Morrison, director of the SEC’s San Francisco regional office, added, “Trabulse encouraged his existing investors to serve as references for new investors. As a result, his false account statements not only lulled existing investors into believing their investments were hugely profitable, but lured new investors into the fraud.”