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U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 22843 / October 11, 2013

Securities and Exchange Commission v. Hochfeld et al., Civil Action No. 12-CV-8202 (S.D.N.Y.)

Court Approves Distribution of $6 Million to Former Heppelwhite Investors

The Securities and Exchange Commission today announced that on October 2, 2013, The Honorable Paul G. Gardephe of the United States District Court for the Southern District of New York, entered an Order approving a Final Distribution Plan for the Fair Fund established in SEC v. Hochfeld et al., 12-CV-8202. In this enforcement action, filed in November 2012, the SEC charged Berton M. Hochfeld and his entity Hochfeld Capital Management, L.L.C. with securities fraud for misappropriating assets and making material misstatements to investors in the Heppelwhite Fund, L.P., a now defunct hedge fund. The Court previously entered judgments against Hochfeld and HCM which ordered, among other relief, injunctions, an asset freeze, and disgorgement of ill-gotten gains and civil penalties in amounts to be determined.

To distribute funds to defrauded investors, the SEC requested that the Court create a Fair Fund, which the Court approved on July 31, 2013. The Court appointed Nancy Chase Burton, a Supervisory Assistant Chief Litigation Counsel at the SEC, as Plan Administrator. To date, the SEC has collected approximately $6.2 million for the Fair Fund. Pursuant to the Final Distribution Plan, thirty-five former Heppelwhite investors will receive this month initial payments from the Fair Fund representing approximately 70% of each investor's prior capital balance in the Heppelwhite Fund. The Final Distribution Plan also provides for a second round of payments to investors that the Fair Fund will make after the SEC has collected additional funds, including proceeds from the sale of Hochfeld's personal assets.

For additional information, see Litigation Release Number 22545 (Nov. 26, 2012).

 

http://www.sec.gov/litigation/litreleases/2013/lr22843.htm


Modified: 10/11/2013