U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20145 / June 6, 2007
United States v. Mark R. Conway, 06-CR-10236-PBS (D. Mass.)
Securities and Exchange Commission v. Mark R. Conway and Groundswell Partners LLC, 05-12209-RWZ (D. Mass.)
Massachusetts Hedge Fund Adviser Sentenced to 7 Years
The Securities and Exchange Commission announced that on May 7, 2007, Mark R. Conway, formerly of Waltham, Massachusetts, was sentenced to seven years in prison, to be followed by three years of supervised release, a $1,300 special assessment fine and payment of restitution in the amount of $20 million based upon his guilty plea to criminal charges brought by the United States Attorney's Office for the District of Massachusetts pursuant to a criminal Information. On October 23, 2006, Conway pleaded guilty to 13 counts of mail and wire fraud in connection with a scheme in which he defrauded approximately 50 investors of more than $20 million. The U.S. Attorney's Office has civilly forfeited approximately $15 million in funds from bank accounts controlled by Conway and will apply the forfeited funds to the restitution amount to be returned to investors.
On November 4, 2005, the Commission filed an enforcement action and obtained emergency relief (including an asset freeze) against Conway and his firm, Groundswell Partners based on conduct similar to that in the criminal Information referred to above. On June 30, 2006, the Commission obtained default judgments against Groundswell Partners and Groundswell Capital, a relief defendant. The Commission is continuing to litigate its action against Conway.