More than one in five hedge fund managers are lying to their investors, according to a new report.
The study, conducted by a quartet of academics, founded that 21% of hedge funds misrepresent past legal or regulatory problems, while nearly three in 10 offer incorrect or unverifiable information about other topics, including assets under management and performance, the study shows.
The study looked at 444 due-diligence reports on 403 different hedge fund managers commissioned by investors between 2003 and 2008, and found that 42% contained “verification problems.”
Of that 42%, half are cases where “the manager verbally stated incorrect information.” This was reported by FINalternatives.
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