Billionaire Michael Platt, 52, is fined $170million for lying to investors after he was caught on camera bragging he was the ‘highest earning person in finance’ last year
A hedge fund tied to a British billionaire who was caught on camera last year bragging about his wealth has been fined $170 million for lying to investors.
Hedge-fund manager 52-year-old Michael Platt who co-founded BlueCrest Capital Management and who is estimated to be worth $8 billion, boasted to a New York taxi driver last December, that he was ‘the highest-earning person in the world of finance.’
Platt has been facing federal charges that his fund deliberately used a computer algorithm it knew to be inferior to manage its clients’ money but then assigned a different more promising algorithm to make money for insiders.
According to the Securities and Exchange Commission, BlueCrest made ‘material misstatements, and misleading omissions’ about how it made its calculations which it’s believed occurred when the very top talent was moved to manage employee capital beginning in 2011.
The money from clients, however, languished in BlueCrest’s flagship fund and was left to an inferior computer algorithm that generated much poorer returns than the new fund, called BSMA, the SEC alleges.
Clients soon realized what was going on and many decided to pull their cash out of the fund as word quickly spread reports the New York Post.
‘BlueCrest repeatedly failed to act in the best interests of its investors,’ the SEC’s Stephanie Avakian said in a statement. ‘Including by not disclosing that it was transferring its highest-performing traders to a fund that benefited its own personnel to the detriment of its fund investors.’
BlueCrest is to pay $132 million to investors along with a $37 million civil penalty.
However, it has neither admitted nor denied the SEC’s findings.
Platt received attention last winter after a cab ride in which he bragged about his enormous wealth as one of the highest earners in the world of finance.
In 2018, he managed to earn an estimated $1.2 billion according to Forbes while in 2019 it’s estimated he earned $2 billion.
Forbes currently estimate him to have a net worth of $8 billion.
‘The thing that’s different about me is … I’m the highest-earning person in the world of finance,’ Platt said deadpan in the video that was filmed in the back of a taxi.
‘I’m the highest-earning person in the world in finance,’ Platt repeats. ‘In the world.’
‘I’ve transformed my fund into a personal investment vehicle because we made such high returns. And now, it’s on the internet, on Forbes,’ Platt told his driver.
The video saw him sharing the cab ride with a pretty brunette woman who looked to be several years his junior.
He introduced her as ‘my girlfriend, Laetitia, the love of my life.’
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