Ribotsky forced out as Manager of NIR Group hedge funds
Posted by Teri Buhl under Hedge Fund Fraud
Corey Ribotsky is officially out as investment manager of his hedge funds run within NIR Group. Investors in his onshore AJW funds received a letter in the mail yesterday explaining PricewaterhouseCoopers Cayman would now be the liquidator of their funds.
Ribotsky’s letter dated January 17th said this was a 30 day notice of his ‘voluntary resignation’ but then wrote he was leaving ‘because of pressure from PWC and some investors.’ Sources close to the SEC investigation said this means he’s out of any decision making role regarding asset sales but PwC wouldn’t answer questions if Ribotsky’s firm First Street will still act as collateral manager of the funds during the liquidation. The investor letter told investors to call PwC if they had questions, which is another signal the alleged fraudster is really getting out of the biz.
This is a win for hundreds of mom and pop investors who invested with Ribotsky through their IRAs or pension funds who’ve been left in the dark about the value of their assets since the last performance report a year ago—NIR reported the onshore fund was negative 2% for January 2011. Last month two investors who spoke with NIR’s Bobby Cohen were told the fund wasn’t planning on providing a year end valuation for 2011 because the SEC investor fraud suit made it difficult to value the assets. These investors told me it’s unclear if they will still get an accounting for tax purposes for 2011 but hope now that PwC is in control there will be more transparency.
Ian Stokoe, the PwC liquidator wrote in an email this morning confirming they now controlled all six of the onshore funds along with the Master fund and the offshore fund. He also said they are in the process of communicating with investors regarding what the next steps will be.
This spring I reported at DealFlow Media, Stoake said part of their role will be to inspect if the assets were overvalued and if investors have overpaid on fees. A notion the SEC also laid out in their lawsuit against NIR Group and Ribtosky filed in federal court this fall. A onshore investors told me today they will be interested to see if PwC uncovers even more information on the level of alleged fraud within the fund now that they control all the assets/funds under the NIR Group umbrella.
Additionally the Department of Justice in the Eastern District of New York once again delayed the sentencing for Ribotsky’s former right hand man, Daryl Dworkin, who plead guilty to taking bribes or kickbacks for PIPE investment in July 2010. The new sentencing date of July 2012 signals the DOJ is still working on their investigating into Ribotsky and NIR Group and Dworkin is very likely helping them in hopes of a lighter jail time –he’s facing up to 30 years. Ribotsky has still not been charged for any criminal wrong doing.
