Kirk Wright Convicted In $150 Million Hedge Fund Fraud

After a two week trial, a federal jury in Atlanta on Wednesday convicted former hedge fund manager Kirk Wright on multiple counts including mail fraud, securities fraud and money laundering. Wright’s firms IMA and IMAAG took in over $155 million in investor funds which purportedly were to be invested in marketable securities and cash, but he allegedly used part of the funds in a Ponzi scheme and diverted most of the rest for personal use over a period of at least five years. Only a small portion was actually invested and that lost value. As of late 2005, Wright had represented to investors and the SEC that over $150 million was under management, but when firms collapsed in early 2006 it was discovered that only about $500,000 was left and investors had typically received statements showing 1000 times what they actually had, including falsified brokerage statements from Ameritrade for non-existent accounts. Wright could face up to 710 years in prison; sentencing is scheduled for August 26 before US District Judge Clarence Cooper. He has been in custody since his May 2006 arrest following two months in hiding (Atlanta Bizjournal, DOJ).