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Re: IPO$ post# 151

Thursday, 01/20/2011 1:27:28 PM

Thursday, January 20, 2011 1:27:28 PM

Post# of 156
This board got some props in this article.

Thursday, 20 January 2011 Print Article Bookmark page Email Article


Long Island hedge fund, NIR Group, probed in plot to inflate asset value

The criminal investigation into NIR Group looks like a Madoff copycat scheme to defraud investors by overstating the value of assets. Investigators are also probing allegations of kickbacks



By Alan Fein

(AXcess News) New York - After a two-year long probe by federal and state authorities, the WSJ revealed earlier today that Long Island-based hedge fund NIR Group is being criminally investigated over its alleged misrepresentation of asset valuation to its investors. At the heart of the probe is Mr. Corby Ribotski who heads up the fund.

Bernie Madoff Junior?Ribotski has come under fire over his handling of investor assets which in 2008 where held up to investors as being worth $780 million. The Journal story said that the hedge fund operator portrayed his fund "as having eight straight years of profits, beginning in 2001," though authorities are now questioning the fund manager's figures ever since NIR Group has been unable to find anyone who would provide a third-party valuation, let alone audit NIR Group's 2008 yearend results.

Breaking News - Two Years Ago

In December, 2008, AXcess News broke a story in which Ribotski's NIR Group took center stage following the downfall of Bernie Madoff in what was the lulu of all Ponzi schemes to hit Wall Street. Only in NIR's case the investigation isn't about assets that didn't exist, though their value is questioned as being so low authorities are dumbfounded as to how Ribotski could have kept it up for eight years.

In the 2008 story, "Madoff Scandal Tip of Iceberg in World of Seedy Hedge Funds", AXcess News reported that investors in Ribotski's NIR Group where growing more and more discontent to the extent that a chat board had been set up on Investorhub.com about Mr. Ribotski and his company.While Ribotski's lawyers placed AXcess News on notice, the story was not recanted. In fact, Forbes picked up on the Ribotski story even earlier saying he had "a history of questionable business dealings and unpaid bills," though that hardly qualifies as "guilt by media" but looking back at my 2008 story I am grateful to see the WSJ finally giving NIR Group the once over, even if it is two years later.

In that Story I wrote: "Men like Mr. Ribotsky never make the press when compared to the Bernie Madoff's of Wall Street perhaps because the investors aren't big enough to matter to the New York Times, WSJ or others."

While the Wall Street Journal said Ribotski's NIR Group was being probed over $780 million in questionable asset value, an October, 2008 story by FINalternatives said NIR Group had $7 billion under management. Seems the Feds are off a bit, which may mean the investigation by regulators will broaden.

So far Ribotski has not been charged with any wrongdoing.

Kickback Scheme

Reuters echoed another aspect of the probe as reported by the Journal claiming individuals where under investigation for their role in a kickback scheme meant to inflate the value of NIR Group's assets. The FBI, SEC and the U.S. Attorney's office in Brooklyn, NY are involved in the investigation, Reuters noted.

Rehashing the News

FINAlternatives basically rehashed the crux of the WSJ story as well, never mentioning its October, 2008 $6 billion difference in funds under management - funny they missed that - though sidebar links did list other stories NIR Group was mentioned in.

Forbes, which has covered Ribotski on more than one occassion, missed today's window of mediatunity and didn't cover the probe at all, though a story could be in the works.

I can only say, that these major publications everone turns to for 'breaking news' on Wall Street might do better to follow those reporters who live in the trenches (hint, hint). As to the outcome of the NIR Group's criminal investigation, I say, wait...as stones turned by the Journal have a tendency to show themselves for what they are, given time. Its a shame AXcess News was never mentioned for having broke the story in the first place, perhaps the next round of news will note that. Stay tuned!


Everything I post is in my opinion. It is true in my opinion but my opinion none the less. Please do your due diligence and contact a licensed professional for advice prior to trading.

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