of Zambia and recovered hundreds of dollars from their hideouts. But the criminal network is growing at breakneck speed where the authorities are unable to control them fully. Both organized and unorganized scamming activities are ruling the world. Scams list related to hedge fund is very big and these scams are making the rounds everywhere. Number of scams related to hedge fund has grown over the years and lots of people have fallen prey to these types of scams. Some of the largest scams related to hedge fund are Madoff Investment Scandal and SAC capital which sent shocking waves to the investors and others. Hedge funds use pooled funds from large institutional investors to employ in diversified portfolios.
In Madoff investment scandal the estimated fraud was around $64 billion and the principal of this organization namely Bernie Madoff was sentenced to 150 years in prison. Scammers will pose themselves as hedge fund investors those who are having high repute and experience. Their main target group will be rich business barons or investors. They will shoot plenty of mails requesting them to deposit their money in hedge funds and if anyone replies they will ask further details such as personal and financial details only to siphon off large chunk of money from their bank accounts. Even the hedge fund operating companies can fool the innocent people by charging excess fees for managing the funds. Hedge fund is only a pooling system where the company will hold millions of dollars from the investors. They will charge thousands of dollars for managing the fund and at one point of time they will liquidate the company and pay the amount back to the investors after siphoning off huge fees that they have paid. Still there is no proper law to control the activities of hedge funds and that is the reason the scammers will play a wonderful game in this area. Investors should follow the below guidelines to safeguard their money
- Should not provide their personal and financial details to the strangers and third parties
- Should thoroughly check the whereabouts of the company that is carrying on hedge fund business
- Should check with others whether they are receiving these types of mails from the scammers
- Should immediately disconnect the calls related to hedge funds.
- Should track the identity of the caller who made hedge fund call.
- Escalate the matter to the police or cyber cell immediately.