{"id":34158,"date":"2020-10-31T15:07:31","date_gmt":"2020-10-31T19:07:31","guid":{"rendered":"http:\/\/stateofthenation.co\/?p=34158"},"modified":"2020-10-31T15:07:31","modified_gmt":"2020-10-31T19:07:31","slug":"now-we-hear-that-the-biden-crime-family-was-involved-with-a-fraudulent-hedge-fund","status":"publish","type":"post","link":"http:\/\/stateofthenation.co\/?p=34158","title":{"rendered":"Now we hear that the Biden Crime family was involved with a fraudulent hedge fund."},"content":{"rendered":"

Paradigm Global, the Bidens and allegedly fraudulent hedge funds \u2013 a summary<\/h2>\n
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John Hempton<\/div>\n<\/div>\n
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This is a summary of the situation to put all the posts in one place. \u00a0You can read this as an alternative to the other posts \u2013 though I will leave the original posts up for posterity. \u00a0There are some versions on the web that are\u00a0wildly inaccurate<\/a>. \u00a0All I will assert is that the Biden’s firm has been shockingly sloppy about basic due diligence issues. \u00a0Unsurprisingly the inaccurate versions are coming from right-wing politics driven blogs (who like the idea that Biden’s family is in trouble) and who reinvent complex facts to fit their simple world view. \u00a0Some of the financial blogs have been\u00a0much better<\/a>.<\/div>\n
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The short version is that an allegedly fraudulent hedge fund (Ponta Negra) shared an office and a phone number and a common marketer (Jeff Schneider) with Paradigm Global a fund of hedge funds owned by the Vice President\u2019s family.<\/div>\n
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Paradigm Global have said that they were subtenants \u2013 and that they were introduced via their common marketer.<\/div>\n
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The story however is murkier than that simple explanation. \u00a0However it is consistent with repeated and extreme sloppiness by the Vice President’s family and the fund of hedge funds they control.<\/div>\n
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First we run through the players in this drama.<\/div>\n
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1. \u00a0The small alleged fraudulent hedge fund: Ponta Negra\u00a0<\/span><\/div>\n
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Ponta Negra is a hedge fund run out of a\u00a0unit<\/a>\u00a0in Connecticut that just had its assets frozen by a Federal Judge and had the SEC accuse it of fraud. \u00a0The Justice Department has yet to file criminal charges and unless criminal charges are filed you would have to wonder what the point of the current crackdown is.<\/div>\n
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The alleged fraud is brazenly simple. \u00a0The company simply produced fake return numbers and doctored accounts from their counterparty brokers to over-represent funds under management. The last set of published return numbers I have access to is here.<\/div>\n
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(click for detail and you can find the original\u00a0here<\/a>)<\/div>\n
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Ponta Negra was run by Francesco Rusciano \u2013 who is also alleged to have faked trading data whilst working for UBS. \u00a0Francesco Rusciano sometimes goes as Krancesco.<\/div>\n
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Ponta Negra was marketed by Jeff Schneider and Jared Toren. \u00a0More on those individuals later.<\/div>\n
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2. \u00a0The fund of funds owned by Joe Biden\u2019s family: Paradigm Global\u00a0<\/span><\/div>\n
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Paradigm Global is a fund of hedge funds headquartered on the 17th Floor of 650 Fifth Avenue. It was founded by Dr James Park who for a while had a reputation as a guru on hedge funds. Paradigm in marketing documents claim particular expertise in \u201cdue diligence\u201d allowing them to source the best hedge fund managers.<\/div>\n
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Paradigm claimed as recently as 2006 in marketing documents that it had over $1.5 billion under management and 28 full time staff as well as offices in New York, Monte Carlo and Tokyo. Now (according to its IARD filing) it has about 300 million in 210 discretionary accounts and 6-10 employees. \u00a0There are no offshore offices.<\/div>\n
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As recently as a few days ago their website claimed that they had never had a down year and that their volatility had decreased over time. \u00a0This is not impossible \u2013 but if it is true that last year was a year of decreased volatility then the performance is truly remarkable. \u00a0Consistently positive returns with low volatility make an 80% reduction in funds under management somewhat difficult to explain.<\/div>\n
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Paradigm was purchased by Hunter Biden and James Biden who are the Vice President\u2019s son and brother respectively. \u00a0Hunter Biden was CEO was for a brief time at the end of 2006 and in early 2007. \u00a0The original press reports implied that was a permanent position but it was later described as an interim position. \u00a0The leadership of the firm since then has been moveable.<\/div>\n
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In the latest\u00a0IARD filings<\/a>\u00a0Hunter and James Biden are listed as owners. \u00a0Markus Karr is listed as the chief investment officer and CEO. \u00a0 Dr Park is listed as an investment consultant.<\/div>\n
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Hunter and James Biden purchased Paradigm when they wanted to get out of the lobbying business. \u00a0Having your son as a highly paid registered lobbyist was incompatible with Joe\u2019s (Vice) Presidential ambitions. \u00a0The purchase was problematic and litigated. \u00a0During the litigation James Biden signed an amazing affidavit which you can find\u00a0here<\/a>.<\/div>\n
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In it he alleged a few things including that:<\/div>\n
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