The founder of the New York hedging fund pleads guilty to the fraud of Neiman Marcus

NEW YORK (Reuters) – A New York hedge fund founder pleaded guilty Wednesday to bankruptcy fraud over pressure from a rival not to bid for assets owned by creditors Neiman Marcus so he can buy them at a lower price, US Department of Justice.

Daniel Kamensky, 48, of Roslyn, New York, pleaded with U.S. District Judge Denise Cote of Manhattan.

Kamensky had been a director of Marble Ridge Capital LP, a “troubled” investment specialist that once had $ 1.2 billion in assets under management.

Kamensky’s lawyers did not immediately respond to requests for comment. Citing a plea deal, a Kamensky spokesman said the defendant could be sentenced to 12 to 18 months in prison in accordance with federal recommendations recommended in the May 7 sentence.

Prosecutors say Kamensky threatened last summer to exploit his role as co-chair of a Neiman creditors’ committee to block an investment bank from bidding 30 cents a share for the securities it wanted to buy 20 cents a share. .

Kamensky also threatened to stop doing business with the bank unless it returned, and after asking an employee there to lie about what happened, prosecutors said.

“You see … I can go to jail,” prosecutors told Kamensky, telling the employee. “She’s going to the American prosecutor’s office.”

US prosecutor Audrey Strauss said in a statement: “Her fraud has indeed reached the US prosecutor’s office and has now been revealed in public.”

Founded in Dallas in 1907, Neiman applied for Chapter 11 protection in May. The luxury retailer appeared four months later under new owners, including investment firms Pimco, Davidson Kempner Capital Management and Sixth Street Partners LLC.

A federal bankruptcy judge approved a decision in December on Neiman’s own claims against Kamensky.

Kamensky was a partner for hedge fund Paulson & Co. before founding Marble Ridge in 2015.

Marble Ridge announced it would liquidate in August last year, after Kamensky’s conduct was examined.