A former attorney turned Las Vegas hedge fund manager has reaped the biggest gains so far in the unfolding mutual fund scandal, the SEC charged yesterday.

Daniel Calugar, 49, who took $175 million in ill-gotten gains, saw $50 million of the money frozen last Thursday when he tried to wire-transfer it.

Calugar closed shop two weeks after New York Attorney General Eliot Spitzer announced what some media reports are calling Spitzer’s "sensational" investigation into the mutual fund industry, including Calugar partner Alliance Capital. (See "Alliance e-mails on Timing Also Incriminated Vice Chair," MME 12/18/03).

Calugar also terminated his membership in the National Association of Securities Dealers at the same time he closed his hedge fund’s doors.

"Calugar’s market timing and late trading were phenomenally profitable to him and came at the expense of long-term mutual fund shareholders," Randall Lee, regional director of the SEC’s Pacific Regional Office, told the New York Post. "It would appear [the SEC is] trying to show they are carrying a [big] stick," added Geoff Bobroff, a widely quoted industry consultant.


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.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.