The Latest: NY hedge founder pleads not guilty

AP News
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Posted: Dec 19, 2016 4:16 PM

NEW YORK (AP) — The Latest on a hedge fund founder and six others charged with fraud (all times local):

4:15 p.m.

A hedge fund executive has pleaded not guilty to securities fraud conspiracy in New York following charges in a $1 billion fraud case linked to an oil rig explosion in the Gulf of Mexico that killed three workers.

Mark Nordlicht, a founder and chief investment officer of Platinum Partners, and six other defendants were named in an indictment Monday. They're accused of lying to investors about the performance of a fund that ran into trouble when one of its largest assets, the Black Elk oil exploration company, had a rig explode in 2012 off Louisiana.

Nordlicht entered his plea in federal court in Brooklyn. The 48-year-old from New Rochelle, New York, is being released on $5 million bond.

Investigators say emails between Nordlicht and others show that they knew about the scheme being perpetrated on Platinum's investors.

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8:30 a.m.

Federal authorities say they're unsealing an indictment charging a hedge fund founder and six others in a $1 billion fraud case.

U.S. Attorney Robert L. Capers in New York City scheduled a news conference for Monday to discuss the case against Platinum Partners chief investment officer Mark Nordlicht.

In June, the FBI arrested a longtime associate of Nordlicht, Murray Huberfeld, along with Norman Seabrook, the head of the nation's largest municipal jail guard union.

Federal authorities alleged Seabrook got tens of thousands of dollars in cash in exchange for steering $20 million in union money to the hedge fund. Seabrook and Huberfeld have pleaded not guilty.

There was no immediate information on an attorney who could comment on Nordlicht's behalf. Platinum representatives did not immediately respond to a comment request.