3 Cambridge hedge funds alleged to have operated as Ponzi scheme

BOSTON – The secretary of the commonwealth recently moved to bar three Cambridge-based hedge funds and its manager, alleging the funds were operated as a Ponzi scheme.
William F. Galvin, secretary of the commonwealth in Massachusetts, filed a complaint against the three funds and Yasuna Murakami, who managed the funds, charging “material misrepresentation and omissions, misappropriation of investor funds and operation of an illegal Ponzi scheme.”

The state estimates Murakami took in about $15.3 million from at least 47 investors, according to a press release.

“The case represents a classic example of a shell game of moving the money from one investor to another with some left over to fatten the coffers of the money manager,” Galvin said. “It is yet another example of how rogue actors use every trick in the book to entice otherwise sophisticated investors to turn over their money based on promised high returns.”

Besides losing other investors’ money, the state also alleges Murakami misappropriated millions for his own personal use, which was used to pay for luxury hotels, liquor stores, cars, high-end retail outlets and American Express.

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The state is seeking to bar Murakami and his funds from the securities business, having him disgorge his accounts of all profits and pay restitution to investors for losses.

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