New York, Sep 29
A New York district court has
approved dismissal of fraud charges by the US markets regulator against
an Indian-American executive at an investment advisory firm.
In
May last year, the Securities and Exchange Commission had alleged that
Aphelion Fund Management's chief financial officer George Palathinkal
had been complicit in a financial fraud by the Chief Investment Officer
of Aphelion.
It said that the firm had fraudulently altered an
outside audit firm's report reviewing the performance of an investment
account Aphelion managed.
Palathinkal had been charged with
knowing about the fraud, but despite that, the falsified report was
distributed to prospective investors. IANS had carried a report in May
2014 about the alleged fraud after SEC had filed a motion in the court.
In
June this year, the SEC approached the United States District Court in
the Southern District of New York, jointly with the defendent, to plead
that "all claimse asserted by the SEC against Defendent George
Palathinkal in this action be dismissed" with prejudice and without
costs, and waiving all rights of appeal, according to documents sent to
IANS by Palathinkal.
The court accepted the plea.
No mention is made in the document about the case against Chief Investment Officer Vineet Kalucha.
Kalucha
was accused by the US regulator for distributing falsified performance
results and siphoning investor proceeds for his luxury car payments.
The falsified report showed a phony gain instead of an actual loss and this was distributed to prospective investors.
The
SEC's complaint had, alleged that company officials told investors at
various times during 2013 that Aphielion had $15 million or more in
assets under management.
The firm actually never had more than $5
million in assets under management at any point during that year, the
regulator told the court.
