Hedge fund owner sentenced

31 January 2007

The former owner of Durus Capital Management was sentenced yesterday to three years in prison and three years of supervised release.

Scott Sacance pleaded guilty to a single count of violating the Investment Advisers Act after he concealed the purchases of shares through false filings with the Securities and Exchange Commission in a bid to manipulate share prices.

US Attorney Kevin O'Connor said: "This prosecution and the term of imprisonment imposed today should send a strong message to hedge fund managers."

He went on to explain that by failing to make the necessary SEC filings, Mr Sacance prevented others form selling stocks in two biotech firms.

Last year, Durus Capital Management chief operating officer J Douglas Schmidt was sentenced to one year probation and given a fine of $10,000 for filing false SEC statements.

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