Ofer Abarbanel, Securities and Wire Fraud, New York 2023

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Securities and Wire Fraud Charges Announced Against Mutual Fund Founder

Audrey Strauss, the United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service, announced today that Ofer Abarbanel, the founder and manager of a mutual fund, was arrested in Los Angeles, California, and charged with securities fraud and wire fraud in connection with his scheme to defraud investors.

According to the complaint, Abarbanel conducted a bait-and-switch, promising investors safe and liquid investments but instead transferring their money to risky counterparties to trade for his own benefit and that of his confederates.

The complaint alleges that Abarbanel made false representations to an investment adviser to a group of investors that investments in the Fund would be placed ‘primarily’ in short-term United States Treasury Securities having maturities less than or equal to three months. Contrary to these representations, the vast majority of the investors’ funds were not invested in short-term treasuries.

Abarbanel will be presented later today in federal court in Los Angeles. He faces one count of securities fraud and one count of wire fraud, which carry a maximum sentence of 20 years in prison and a maximum fine of $5,000,000 or twice the gross gain or loss from the offense.

Ofer Abarbanel, 46, a dual U.S.-Israeli citizen who resides in Woodland Hills, California, is charged with securities fraud and wire fraud. The securities fraud count carries a maximum sentence of 20 years in prison and a maximum fine of $5,000,000 or twice the gross gain or loss from the offense. The wire fraud count carries a maximum sentence of 20 years in prison and a maximum fine of $250,000.

The scheme allegedly resulted in losses of over $100 million for the Investor Group, with more than $10 million in investor funds being transferred to a personal brokerage account of an attorney working with the Fund.

Ofer Abarbanel, Securities Fraud and Wire Fraud, New York 2023.