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Thank you Alex.
Best wishes,
chas
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
<A title=AJacobson@xxxxxxxxxxxxxx
href="">Jacobson, Alex
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="">realtraders@xxxxxxxxxxxxxxx
Sent: Wednesday, February 04, 2004 9:45
AM
Subject: RE: [RT] PRIME BROKER AND
FRAUD
<FONT face=Arial color=#0000ff
size=2>First of Prime Brokerage by definition means custody is done somewhere
else. A true Prime Broker would not hold any positions and would be a
direct access exchange member. A Prime Broker also would not,
regrettably, provide any client info as they custody nothing. You would
want to make certain the broker with custody is kosher. The Prime could
trade badly and lose money, but they custody nothing. The custodial
broker could have some responsibility in a theft or fraud.
<FONT face=Tahoma
size=2>-----Original Message-----From: Charles Meyer
[mailto:chaze@xxxxxxxx]Sent: Wednesday, February 04, 2004 8:07
AMTo: REAL TRADERSSubject: [RT] PRIME BROKER AND
FRAUD
Group-
Can anyone shed light on this
issue? These questions come from
an ananomous man who purportedly lost some money thru a <FONT
face=Arial size=2>hedge fund fraud. The problem is that I don't
understand the nature of the questions and how they relate to the way the
money was stolen? Can anyone tell
me how they stole his money and the Prime Broker
link? I can only get
info
in bits and pieces and my correspondent is
often lazy with providing me information.
Thanks for your time, attention, and any
feedback.
<FONT face=Arial
size=2>
chas
====
Hedge Fund Prime Brokerage Due
Diligence
1) Are you currently or have you ever
been a Prime Broker for xxxxx?
2) Does your arrangement provide for
exclusitivity in any way or is xxxxx free to pursue additional
Prime Brokerage arrangements in addition to yours?
Can you provide
details in any way?
<FONT face=Arial
size=2>
2) If you are no longer a Prime for
xxxxx, can you tell me the circumstances as to why this is no longer
true?
Under your Prime arrangement (current or past,
please note) the following questions;
3) Are all assets, including cash, held
in your custody?
4) Explain how fund assets may be moved
and invested.
5) What are your policies and procedures
to safeguard fund assets (3rd party signatures, multiple signatures,
etc.)?
6) Does xxxxx have multiple accounts
with you? If so, how do you assure that all accounts are traded on an
equal basis?
7) Do you perform any type of valuation
services (such as calculation of NAV, account balances, etc.)?
8) In addition to the above, can you
please describe any other duties and responsibilities that your arrangement
with xxxxx entails?
9) Is there anything else that you can
tell me that would help me better understand the relationship that you have
with xxxxx and / or the Fund Manager?
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