COLUMBUS, Ohio (HedgeWorld.com) - The Securities and Exchange Commission filed an amended complaint in its case against Paramount Financial Partners LP, a purported hedge fund.
According to the SEC's complaint, Kevin Hightower and his marketers helped Paramount and its principal Von Christopher Cummings recruit investors and in return received large secretive commissions. Mr. Hightower allegedly accepted US$720,000 of investor funds from Paramount into his business accounts, of which US$583,000 he distributed to brokers, keeping US$137,000 as his own fee.
Five other defendants, who were marketers, are now part of the case along with Mr. Hightower. They are: Mark D. Deyak; Michael L. Louis, John E. Hawley, Jr., Michael L. Vogt, and Omar Benaouda.
The SEC, in its original complaint in June, named Paramount Financial Partners, the purported hedge fund; Paramount Capital Management, the general partner and investment adviser for the fund; John A. Ryan, a marketer of the fund; Kevin L. Grandy, another fund marketer, and James Curtis Conley, a Paramount employee, and others as defendants. Allegedly, the defendants falsely portrayed Paramount as a "registered hedge fund" that posted returns of as much as 99%. Investors were told they were required to maintain their principal and supposed profits with Paramount for a set period of time, usually between several weeks or months. The firm then allegedly issued false trade confirmations and account statements to trick investors into believing they had generated large profits. New money coming in from new investors was then used to pay earlier investors and other expenses
