TAMPA (CN) – A father and son team of investment advisers overstated the assets of three hedge funds they managed by $160 million, and didn’t actually manage the funds, but turned them over to Arthur G. Nadel, the SEC claims in Federal Court. The SEC sued Nadel last year for allegedly overstating the assets of his hedge funds by $300 million.
The SEC sued Neil V. Moody, 71, and Christopher D. Moody, 35, in the new complaint. They claimed to manage Valhalla Investment Partners, the Viking Fund and the Viking IRA fund, the SEC says.
“In fact, the Moodys recklessly overstated the value of the Moody Funds’ assets by as much as $159,975,499,” the complaint states. It adds: “In addition, the Moodys recklessly misrepresented to investors that they actively managed the business operations of the Moody Funds, including the funds’ investment and trading activities. In fact, Arthur G. Nadel controlled nearly all of the Moody Funds’ investment and trading activities with no meaningful supervision or oversight by the Moodys.”
Nadel claimed to be managing $300 million in assets though they actually had shrunk to $506,000 at the time, the SEC said in its complaint against him.
According to Chris Moody’s attorney, Jeffrey Cox, the SEC’s complaint “does not allege that Chris Moody knowingly intended to harm investors. The complaint alleges recklessness which Mr. Moody neither admits nor denies.”
Cox said his client “has cooperated from the outset … and will continue to do so.”
The Moodys and Nadel all live in Sarasota. The SEC seeks disgorgement, penalties and an injunction.