SEC Charges Hedge Fund Billionaire Phil Falcone

As had been widely expected, the Securities & Exchange Commission on Wednesday filed securities fraud charges against hedge fund billionaire Philip Falcone and his firm, Harbinger Capital Partners. The civil enforcement action accuses Falcone of fraudulently taking out a $113 million loan from one of his hedge funds to pay his personal taxes and giving certain investors in his troubled hedge fund like Goldman Sachs the chance to cash out their investment while restricting redemtions for other investors. Those civil charges were widely expected to be brought ever since settlement negotiations between Falcone and the SEC dissolved over the regulators’ insistence that Falcone serve some sort of securities industry ban, which would have effectively ended his investment career. Read more in Forbes here.