(888) 637-5510

Written by 12:47 pm Blog

SEC Charges Two Former Och-Ziff Execs


Och-Ziff Investment Losses

Are you concerned about investment losses with Och-Ziff Capital Management? If so, The White Law Group may be able to help you recover your losses through FINRA arbitration.

According to Bloomberg, Och-Ziff Capital Management Group LLC is a global, institutional alternative asset manager, providing services to investors through its multi-strategy, credit, equity, and real estate funds, CLOs and other alternative investment vehicles. The Company’s funds invest across multiple asset classes, strategies and geographies, consistent with the investment objectives for each fund.

Och-Ziff is reportedly one of the world’s largest hedge funds with $39.1 billion in assets. It has also suffered $5.5 billion in net outflows this year, according to the same report. Additionally, Och-Ziff’s share price has dropped about 90 percent from its 2007 IPO price.

According to a press release on Thursday, the SEC charged two former executives at Och-Ziff Capital Management Group with being the driving forces behind a far-reaching bribery scheme that violated the Foreign Corrupt Practices Act (FCPA).

Och-Ziff and two other executives previously settled charges against them in the case.

The SEC’s complaint alleges that Michael L. Cohen, who headed Och-Ziff’s European office, and an investment executive on Africa-related deals, Vanja Baros, caused tens of millions of dollars in bribes to be paid to high-level government officials in Africa.

Their alleged misconduct induced the Libyan Investment Authority sovereign wealth fund to invest in Och-Ziff managed funds. Cohen and Baros also allegedly directed illicit efforts to secure mining deals to benefit Och-Ziff by directing bribes to corruptly influence government officials in Libya, Chad, Niger, Guinea, and the Democratic Republic of the Congo.

SEC Investigation

The SEC detected the misconduct while proactively scrutinizing the way that financial services firms were obtaining investments from sovereign wealth funds overseas.  The SEC’s subsequent investigation of Och-Ziff found that the fund used intermediaries, agents, and business partners to pay bribes to high-level government officials in Africa.

The SEC’s order finds that Och-Ziff’s books and records did not accurately describe the true purposes for which managed investor funds were used, and the company did not have adequate internal controls to detect or prevent the bribes.

The White Law Group is investigating the liability that brokerage firms may have for improperly selling high-risk investments like Och-Ziff Capital Management to their clients.  Upon information and belief, certain advisors have been touting the income potential of the investment without fulling disclosing the enormous risks.

Broker dealers are required to perform adequate due diligence on all investment recommendations to ensure that each investment recommendation that is made is suitable for the investor in light of the investor’s age, risk tolerance, net worth, financial needs, and investment experience.  Advisors are also required to disclose all risks.

Fortunately for investors, FINRA does provide for an arbitration forum for investors to resolve disputes and if a broker or brokerage firm makes an unsuitable investment recommendation or fails to adequately disclose the risks associated with an investment they can be found liable for investment losses in a FINRA arbitration claim.

Recovery Options

To determine whether you may be able to recover investment losses incurred as a result of your purchase of Och-Ziff Capital Management, please contact The White Law Group at 1-888-637-5510 for a free consultation.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee. The firm represents investors throughout the country in claims against their brokerage firm.

For more information on the firm and its representation of investors, visit www.WhiteSecuritiesLaw.com.


Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , Last modified: April 10, 2017