Thursday, May 25, 2006

$1 Million Bond for Former Hedge Fund Manager

Kirk Wright has been accused of causing loses -- or looting -- of over $100 million in hedge funds he managed, and to this point the government has only been able to recover approximately $150,000, not counting the $28,000 in cash on him when he was found.  Wright was arrested at the Ritz-Carlton in Miami on a warrant issued after the filing of a single-count criminal information alleging securities fraud in the Northern District of Georgia, and will be returned to Atlanta to face what will likely be a multi-count indictment.  A U.S. Magistrate set bond at $1 million, and according to a South Florida Sun-Sentinel story (here), prosecutors plan to appeal the bond decision on the ground that Wright is a flight risk.  He will remain in jail until the initial appeal to a district judge is decided.  While the Bail Reform Act does not permit a court to set a bond so high that it effectively keeps a defendant in jail, courts are permitted to require a defendant to deposit property with the court or post a surety bond (18 U.S.C. Sec. 3142(c)) to be released, or else remain in jail.  In 2005, mutual fund manager Alberto Vilar spent over a month in jail when he was unable to post property to meet a multi-million bond. 

Whether Wright will be able to put up $1 million that is untainted by the alleged fraud is another question, but U.S. Magistrate Judge Stephen Brown told Wright that "[i]f you're going to hide and you're going to flee, the Ritz-Carlton in South Beach is not the place you want to go."  I can think of a lot worse places than a Ritz-Carlton to hide out, although perhaps a location outside the United States might have been just a bit more effective, if one were to flee. (ph)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2006/05/1_million_bond_.html

Fraud | Permalink

TrackBack URL for this entry:

http://www.typepad.com/services/trackback/6a00d8341bfae553ef00d83425eeb653ef

Listed below are links to weblogs that reference $1 Million Bond for Former Hedge Fund Manager:

» Kirk Wirght and the SEC's Case for Stay of Pretrial Release from Psychology of Compliance & Due Diligence Law
The Wall Street Journal Law Blog reported that a "Florida judge's conditional bail offer to Wright was stayed after federal authorities in Atlanta appealed the... [Read More]

Tracked on May 26, 2006 4:53:28 AM

» Kirk Wirght and the SEC's Case for Stay of Pretrial Release from Psychology of Compliance & Due Diligence Law
The Wall Street Journal Law Blog reported that a "Florida judge's conditional bail offer to Wright was stayed after federal authorities in Atlanta appealed the... [Read More]

Tracked on May 26, 2006 4:55:46 AM

» Kirk Wirght and the SEC's Case for Stay of Pretrial Release from Misleading Advertising Law
The Wall Street Journal Law Blog reported that a "Florida judge's conditional bail offer to Wright was stayed after federal authorities in Atlanta appealed the... [Read More]

Tracked on Mar 6, 2007 4:54:24 AM

Comments

The Wall Street Journal Law Blog reported that a "Florida judge's conditional bail offer to Wright was stayed after federal authorities in Atlanta appealed the decision. Wright, whose Atlanta-based hedge funds are missing more than $110 million in client assets, faces mail-fraud charges in filed in Atlanta in late March".

The SEC offered the evidence that there should be a finding of either danger to the community or risk of flight which would be sufficient to detain the defendant pending trial. See: http://www.bizop.ca/blog2/000171.html

Posted by: Michael Webster | May 26, 2006 4:56:24 AM

Post a comment