Maybe Don’t Pick Your Hedge Fund Manager Based On His Ability To Get You Invited To Elton John’s Oscars Party

Unless you’re willing to pay your life savings for that ticket, that is.
By Ernst Vikne [CC BY-SA 2.0 ], via Wikimedia Commons

By Ernst Vikne [CC BY-SA 2.0 ], via Wikimedia Commons

During his career as a hedge fund manager, Raymond Montoya told his clients many things: That he managed $4 billion. That he was investing all their money in stocks and bonds, and making them a killing while doing so. That he definitely wasn’t running a Ponzi scheme. Oh, and that he could get you into Elton John’s blowout Academy Awards party. Only one of these things was true.

Montoya may have lured in investors by getting them invitations to exclusive parties attended by big names, including the glamorous Elton John Academy Awards party two years ago.

Cathy Roth, an accountant, was invited and remembered the thrill of riding in a limo to the fete.

She said being seated next to Hollywood royalty was intoxicating.

And came with a hell of a hangover:

She was conned out of as much as $6.6 million by Montoya…. “I don’t own a home or have any other assets,” she said.

She had to give up her apartment in a glamorous area of Newport Beach, Calif., when she could no longer afford the $6,000-a-month rent.

She then moved in with a friend to save money.

“I am thinking of applying to Starbucks to become a barista, to get some spending money and my health insurance,” she said.

Anyway, like Roth’s post-party high, Montoya’s handy luxury-car-and-mortgage-payment plan couldn’t last.

Raymond K. Montoya, 70, of Allston, pleaded guilty to three counts of wire fraud, five counts of mail fraud, and two counts of conducting an unlawful monetary transaction…. The charges of mail fraud and wire fraud provide for a sentence of no greater than 20 years in prison…. The charge of conducting unlawful monetary transactions provides for a sentence of no greater than 10 years in prison….

Hedge Fund Manager Pleads Guilty to Operating Multi-Million Dollar Ponzi Scheme [press release]
Hedge fund manager charged for scamming investors out of millions [N.Y. Post]