There are a surprising number of Ponzi schemes that, once they get found out, become a funny story.
If $600 million Vision Capital turns out to be operating fraudulently, theirs will be one of them, because a fund run by two visually impaired guys called Vision Capital is screaming, we’re lying our (eye)balls off.
Subpoenas sent out by the SEC’s New York office seek emails, transaction documents and other communications between Vision Capital and the investment firms going back to early 2005 — the hedge fund’s first year in business, when the [visually impaired] managers burst on the scene in 2005, when Vision posted a 105 per cent gain. They followed that up with an even better 188 per cent return in 2006.
But returns fell sharply in more recent years. And since last year, investors have been unable to pull money out of most Vision funds.
DUN DUN DUN. There have been a crazy number of Ponzi schemes or fraud schemes reported this past year, so we’re really not surprised by this.
Plus, all we know now is that the SEC is investigating Vision, and that it might have something to do with rumours that former employees have been concerned about the manner in which the fund was valuing some of the warrants it obtained in return for its cash investments in those small public companies. But pretty soon we should know what they find – maybe Vision cooked up a really complicated fraud that we will weirdly admire.
Until then, this fund is just another drop in the bucket – but with a potentially funny story.