REPORT: Phil Falcone Plans To Blame Everything On His Lieutenants and Lawyers

Phil Falcone


The Wall Street Journal reports that Falcone’s planned defence against the SEC’s fraud allegations filed is to blame his lawyers and lieutenants, sources told the paper.  From the WSJ: 

Mr. Falcone plans to try deflecting blame to a former Harbinger operating chief and two lawyers who advised him to borrow $113.2 million in 2009 from a Harbinger fund to pay his personal taxes even though other investors were blocked from withdrawing money, according to people familiar with his defence.

Last week, the Securities and Exchange Commission sued hedge fund billionaire Phil Falcone and his Harbinger Capital Partners over alleged securities fraud

The SEC alleges that Falcone and his fund engaged in “illicit conduct that included misappropriation of client assets, market manipulation and betraying clients,” the SEC’s release said. 

Peter Jenson, Harbinger’s former Chief Operating Officer who left the fund in Jan. 2011, was also charged by the SEC for allegedly aiding and abetting the misappropriation scheme.

In the SEC’s complaint, the regulatory authority alleges that back in 2009 Falcone used Harbinger’s Special Situations Fund (SSF) money, which he allegedly had barred investors from withdrawing, to pay $113.2 million in state and federal taxes. Read more here >

Falcone’s attorney responded to the SEC’s charges calling them “completely unsupported.”  

When Kevin Roose and Jessica Pressler at Daily Intel asked Falcone about the charges the day the SEC announced them he responded via email “Piece of cake,” adding, “It’s not like I’m having a heart transplant.” 

SEE ALSO: Check Out Phil Falcone’s Breathtaking St. Bart’s Estate Mentioned In The SEC Complaint Against Him >

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