AlphaMetrix has $700 mln frozen
AlphaMetrix, which was ironically marketed to investors as a safe-house against the likes of Bernie Madoff, finds itself in some hot waters. Based in Chicago, the US company provides customers with opportunities to invest in futures accounts run by professional traders and has a commodity pool operator under the name AlphaMetrix LLC.
The CFTC filed a complaint on the 4th of November against AlphaMetrix LLC for misappropriating at least $2.8 million and sending out false account statements to at least some of its customers. Between the 1st of January and October 31st the company has sent pool participants statements that their dividends have been reinvested, while in fact it has transferred funds to bank accounts of its parent company AlphaMetrix Group LLC.
The noise surrounding the company started last month when it announced that it was having cash-flow issues. In a letter to investors on October the 10th, the company informed investors that its liabilities were “greatly exceeding” its liquid assets. As Bloomberg reported the company then scrapped their CFO and committed its efforts towards obtaining liquidity to solidify its cash position. However the efforts have not resulted in much improvement.