The Hedge Fund Fraud Casebook

Praise for The Hedge Fund Fraud CasebookThis book is a startling eye-opener. Bruce Johnson delivers the promised goods and wraps it all in a context of history that itself is fascinating reading. Along with the cases themselves comes the story of the enormous and persistent effort it took to uncover and detail them.--John A. Prestbo, Editor and Executive Director, Dow Jones IndexesThis book is an essential read for hedge fund investors and analysts who seek to deepen and enhance their base of knowledge. Extremely relevant due to the current turbulent economic climate, the author exposes the basic elements in the construction of the hedge fund credit model and how it can be implemented to assess the probability of a hedge fund failure. Following this analysis is an in-depth application to the real world in the form of 100 chronologically arranged cases of hedge fund fraud. Following each case is a summary of pertinent facts, charts, tables, and a textual conclusion to better facilitate case analysis. This timely volume will be of importance and much interest to any investor or analyst who wants to further their practical education and augment their personal efficacy.--Ho Ho, Quantitative Portfolio Manager, CalPERSThis book is a big dose of realism about the world of fraud and potential fraud that surrounds all of us who take risks for a living. Bruce Johnson has catalogued the key components of each case of fraud over the first thirty-two years of the hedge fund industry. In doing this, he has created the equivalent of a periodic table of the elements for the complex world of financial fraud and hedge funds. This breakthrough represents both a valuable set of insights into the industry as well as an important methodology for studying it.The Hedge Fund Fraud Casebook is required reading for anyone who grapples with risk in financial markets.--Teresa Barger, CEO, Cartica CapitalHaving invested in the markets for over twenty years, I have a deep appreciation for what Bruce Johnson has accomplished in this book. It opens a rare window into the 'dark side' of the often secretive world of hedge funds. This is a well written book that is a must-read for anyone who evaluates and selects hedge fund managers.--Jolanta Wysocka, CEO, Mountain Pacific Group, LLCBruce Johnson provides a thoughtful analysis of the history of hedge funds in this well-researched book about hedge fund fraud. Careful and thorough due diligence is paramount when selecting any investment product, but in an industry that prizes opacity coupled with high fee structures, investors must rely on specialists with broad market knowledge, historical perspective, and strong analytical skills to ascertain managers with robust organizations, sustainable investment processes, sufficient resources, and a strong back office in order to achieve consistent investment returns. The Hedge Fund Fraud Casebook provides an in-depth review of the life cycle of hedge funds and commonalities of behavior that leads to fraud.--Julia K. Bonafede, CFA, Head of Wilshire Consulting