NEW HAVEN, Conn. (AP) — Three former hedge fund executives pleaded guilty to a conspiracy charge stemming from a scheme to deceive investors in order to keep a big customer, federal prosecutors said Thursday.
David Bryson, 45, of Ridgefield; Bart Gutekunst, 62, of Weston; and Richard Pereira, 42, of Ridgefield, pleaded guilty Wednesday in New Haven to conspiracy to commit wire fraud, the U.S. attorney's office said. The three are former executives of New Stream Capital LLC, a Ridgefield-based hedge fund.
In 2007, New Stream told foreign investors that a fund would be closing and they would have to move their investments into new funds in the Cayman Islands. At risk of losing their largest investor, the three set in motion a scheme to secretly keep the fund open and give priority to certain investors, prosecutors said.
New Stream failed to inform investors who had transferred into the Cayman Islands fund that the existing fund was remaining open or that it was being given priority over the Cayman Island fund, prosecutors said. New Stream also concealed the magnitude of the pending redemptions, prosecutors said.
The charge carries up to five years in prison. The three are scheduled to be sentenced in August.
Gutekunst's attorney declined to comment. Telephone messages left with attorneys for Bryson and Pereira were not immediately returned.