Personal finance

Harvard Business School grad’s Ponzi scheme swindled alums out of $2.9 million, New York attorney general says

Products You May Like

A general view of the Baker Library/Bloomberg Center on February 17, 2024, at Harvard Business School in Allston, MA. 
Erica Denhoff | Icon Sportswire | Icon Sportswire | Getty Images

A Harvard Business School graduate tricked his fellow alumni and associates into investing at least $2.9 million in a Ponzi scheme he ran, New York Attorney General Letitia James said Thursday.

James’ office said it had secured a court order blocking the grad, Vladimir Artamonov, “from harming investors through his fraudulent scheme,” which allegedly projected returns of 500% to 1,000% by claiming to learn which investments Berkshire Hathaway planned to make.

The order in Manhattan Supreme Court also bars Artamonov from withdrawing and transferring funds in his bank and brokerage accounts.

Artamonov allegedly lured at least 29 investors into the scheme, most of whom he met through his connections to the elite college, the attorney general said.

More from Personal Finance:
This IRS issue is ‘the biggest, most consistent problem’ for filers
Number of 401(k) millionaires and average balances rose in 2023
‘Ghosting’ gets more common in the job market: It’s not a ‘passing fad

James’ office said Artamonov lost millions of dollars in investors’ funds by buying short-term options but did not disclose his losses, instead using new money invested with him to repay existing investors.

“Artamonov also used his investors’ money to fund unauthorized personal expenses for vacations, shopping, and dining,” the office said.

James’ office said it learned of the fraud when it was told about an investor who ended his own life after discovering he had lost $100,000 in Artamonov’s alleged scheme.

Even after the man’s suicide, Artamonov continued soliciting new investors, lying to them about the fund’s strategy and performance, James’ office said in a statement.

“Even sophisticated investors can be conned by fraudsters, especially when personal relationships and networks are used to build a false sense of trust,” James said.

“Vladimir Artamonov used his alumnus status from Harvard Business School to prey on his classmates and others while seeming legitimate and dependable. Instead, he has been scamming people out of their investments, with horrific consequences.”

Artamonov did not immediately respond to requests for comment.

Mark Cautela, head of communications at Harvard Business School, told CNBC in an email: “We just found out about this earlier today. We have no additional comment.”

Artamonov, who James’ office said graduated from the business school in 2003 with a master’s degree, previously worked in New York as a securities professional.

James’ office said that from September 2021 up to the present, he solicited at least $2.9 million from at least 29 investors for an investment fund dubbed “Project Information Arbitrage” or the “Artamonov Fund.”

“Artamonov identified many of his investors through the HBS alumni network,” the AG’s office said. “Many of his investors did not have a close personal relationship with him and only knew him as an acquaintance.”

The office said “Artamonov lured clients by claiming that he could learn which investments Berkshire Hathaway would make ahead of the market by examining public state insurance filings.”

“Artamonov boasted to his investors that it is like ‘having a private time machine’ and ‘getting tomorrow’s newspaper today,'” as he projected massive investment returns, James’ office said.

But in reality, the office said, Artamonov used the investors’ funds to purchase short-term options which expired within days of purchase “and appeared to have no relation to Berkshire Hathaway or its investment activities.”

Products You May Like

Articles You May Like

Hugo Boss shares plunge 9% as firm cuts 2024 guidance amid slumping China demand
Here’s why international buyers are pulling way back from the U.S. housing market
HSBC appoints Georges Elhedery as group CEO starting Sept. 2
The election could have a ‘massive impact’ on the municipal bond market, analyst says
We’re hiking our price target on Morgan Stanley despite a miss in a key business

Leave a Reply

Your email address will not be published. Required fields are marked *