The SEC charged John A. Geringer, a California investment advisor, who ran a private investment fund in a Ponzi-like manner.  According to the SEC, since 2005 Geringer raised over $60 million by misrepresenting the performance strategy of the GLR Growth Fund, L.P.  Geringer used false and misleading marketing materials to deceive investors into believing that his fund was successful when it was actually losing money.  To conceal his misrepresentations, Geringer used the money he raised from new investors to pay back earlier investors.

The SEC alleged that Geringer created and distributed marketing materials suggesting that the fund was able to achieve annual returns between 17 and 25 percent from 2001 to 2011, when in reality the fund was created in 2003 and experienced losses throughout.  Geringer claimed that in 2008, in the midst of the financial crisis that caused the S&P 500 to decrease almost 38.5%, the GLR fund had an annual return of nearly 24%.  Geringer deceived investors by falsifying documents such as brokerage account statements and year-end summaries, and misrepresenting the fund’s asset allocation.

The SEC stated, “Geringer painted the picture of a successful fund weathering America’s financial crisis through a diversified, conservative investment strategy… [t]he reality, however, was the complete opposite.  Geringer lost millions of dollars in the market, tied up remaining investor funds in a pair of illiquid private companies, and lied about it in phony account statements.”

It is unclear at this time whether the FINRA Arbitration process will be appropriate for Geringer’s investors.  Any investor interested in speaking with a securities attorney may contact David A. Weintraub, P.A., 7805 SW 6th Court, Plantation, FL  33324.  By phone: 954.693.7577 or 800.718.1422.