January 31, 2020
Jason Rhodes, the co-founder of hedge fund Sentinel Growth Management, pleaded guilty to securities fraud, investment adviser fraud, wire fraud, and conspiracy charges in a Ponzi scheme to defraud $19.6 million out of 25 investors.
Rhodes, a resident of Rowayton, a village in Norwalk, and his co-conspirators falsely represented to investors that their funds would be used for legitimate investments, largely by purchasing securities. Instead, Rhodes diverted investor funds for his and his co-conspirators’ personal use and to make payments to earlier investors. The U.S. Attorney for the District of New York, Geoffrey Berman, also claimed that Rhodes falsified an investor account statement in an attempt to conceal that most of the $4.2 million this investor placed in the hedge fund had been misappropriated. The scheme lasted through December 2016.
Rhodes will be sentenced on April 6, 2020 where he faces numerous years prison time and over $5 million in fines.