Reply #13: Ariz AG says seized $101 mln in (Bayou) hedge fund probe [View All]

[UpInArms]

http://today.reuters.com/investing/financeArticle.aspx?type=fundsNews2&storyID=URI:urn:newsml:reuters.com:20050831:MTFH98060_2005-08-31_00-11-20_N30311556:1

NEW YORK, Aug 30 (Reuters) - The Arizona Attorney General's office on Tuesday said it had seized $101 million that may belong to Bayou Management LLC, the Connecticut money management firm under investigation for possible fraud.

The money was seized on May 19 at a Wachovia Corp. (WB.N: Quote, Profile, Research) bank branch in Phoenix, two months before it emerged that Bayou was being investigated by state and federal law enforcement officials, according to Arizona Attorney General Terry Goddard's spokeswoman, Andrea Esquer.

Connecticut Attorney General Richard Blumenthal last week said that Stamford, Connecticut-based Bayou is being probed for failing to account for some $440 million that it listed as having under management following investor complaints.

The fund told investors in recent weeks that it was closing but investors have yet to see any money, law enforcement officials have said.

The Arizona disclosure is the latest twist in a widening mystery to roil the secretive hedge fund world. Separately, Blumenthal said today the state is forming a task force to look into reforming the hedge fund industry, a move likely to face industry opposition in a state with more hedge funds than any other.

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:wtf: