According to FINalternatives, this is the second time Malova has been arrested for forging a prescription. There is another case pending in Manhattan from November. This time, Malova filled a prescription using a pad stolen from her psychiatrist’s office to obtain 85 pills, the New York Daily News reports. According to the Associated Press, Malova’s doctor reported her prescription pad stolen shortly after Malova left there Feb. 24. Although she was a doctor in Russia, she is not licensed to practice in New York.

Anyhoodle, on April 20, the SEC fired up the batmobile and arrested five people from Staten Island who thought it was a good idea to pretend to run a $1.4 billion hedge fund– because, you know, the SEC is made up of a group of people whose mission in life is basically just to be a major buzz kill. Thanks, Mary Schapiro. In reality, according to Business Insider, these schmucks were actually using fake names, offices, and ridiculous quotes on ridiculous (I honestly can’t think of another more appropriate word) websites to lure in investors rather than running any sort of a legit business. I’ve got to give them credit, though: these guys saw an opportunity to swindle investors and they didn’t just go with your typical Ponzi scheme– no, these guys really went above and beyond, using all of their combined creative forces to compose their fictional ten-man team of superstar grads from Harvard and Wharton. But they didn’t stop there. No, these assclowns decided to bring in the big guns and created false endorsements from the likes of the Financial Times and George Soros. It would be brilliant if it weren’t so completely unbelievable– except, here’s the thing: people actually bought it.

An example of some of the crap they were peddling, according to Business Insider:

Ken Marsh, who went by “Ken Maseka,” “Michael Warren,” and “Marcus Thorn,” according to the SEC’s complaint, was a front-man for the fake $1.4 billion fraudulent hedge fund. He described himself to investors as “Wall Street’s Most Wanted,” using this bio:

Back in 1991 Kenneth Maseka was the most sought after trader on Wall Street for his uncanny knack for finding Wall Street’s hidden gems. In 1995 his average profit exceeded 1000% per trade (not much has changed since then.)

Goldman Sachs, Lehman Brothers and Bear Stearns could not lure him away with offers of millions of dollars up front to come over. Maseka asked himself, “Where is the challenge,” and passed on their generous offers. Anyway, when you are averaging 1000% per trade there is no need to be an employee and a few million dollars is nothing in the long-term scheme of things. (Emphasis ours.)

But, as it turns out, Ken Maseka is a fictional character of Ken Marsh’s invention. The company also made up the rest of its other employee’s names, and fudged the fact that Maseka and Michael Warren were billionaires. A quick fact check of Forbes’ billionaires list by any potential investor doing even the most routine due diligence would have tipped them off that something was rotten in the state of Denmark. Also fake: Gryphon’s Wall Street address. Their real office is in Staten Island in between a martial arts school and a bakery. Classy.

Better yet, these guys posted “press” from the FT, which supposedly wrote:

This secret group has identified as the latest hedge fund to exploit the weakening sub prime markets – pounding stocks down to nothing and making billions along the way, one hedge fund run by this group had been rammed to see returns of over 1000% in 2007.

But the most deliciously deceitful part of the scam is that they went so far as to post a fake quote from, of all people, George motherfu$&ing Soros on their website pretty much saying that these guys were the shit.

“Alone the traders of Gryphon Financial are incredible, together they are unstoppable”
– George Soros

I mean, really? I honestly can’t believe people bought this crap.

According to Business Insider, some of the other BS they posted on one of their related sites (Gryphon Daily) included:

* “Join this Exclusive Service or Go Broke!”
* “It’s like having your own mini Hedge Fund”
* 9 out of every 10 trades will hit 100% profit status?
* Returns of Up to 483% in Less Than 2 Months?
* Just this once – step outside your comfort zone – buy stocks without prejudice and don’t look at the numbers, don’t look at the chart, buy the stock the minute you hear from us and don’t sell a single share until we tell you to – do this and you are rich, do not and continue to invest in mediocrity.”

Sadly, a surprising number of people fell for it. The five alleged fraudsters ended up scamming some $17.5 million from unsuspecting investors.

According to a BusinessWeek.com report, Soros said earlier this week at a London event that he was in favor of the Volcker rule.

The article went on to say that financials accounted for 6.6 percent of Soros Fund Management LLC’s stock holdings during the fourth quarter, according to a regulatory filing. Citigroup Inc., one of the large banks likely to be affected if the Volcker rule is passed, was the hedge fund’s fifth-largest stake as of Dec. 31, with 94.7 million shares. Currently, Soros Fund Management has about $25 billion in assets.

Although the Volcker rule is not written into the House bill that was passed, the Senate’s banking panel approved Sen. Christopher Dodd’s financial-rules overhaul, furthering the Obama administration’s efforts to accomplish the largest restructuring of Wall Street in nearly seven decades, according to BusinessWeek. The bill itself would create a consumer protection bureau at the Federal Reserve, if passed, in addition implementing the Volcker rule and establishing a mechanism that enables the government to dismantle failed firms that threaten the financial system.

We’re not talking millions or even tens of millions or hundreds of millions. We’re talking billions. With a B. In fact, the highest earning 25 hedge funders earned a collective $25.3 billion, according to the survey, beating the old 2007 high by a wide margin. According to the New York Times,

The minimum individual payout on the list was $350 million in 2009, a sign of how richly compensated top hedge fund managers have remained despite public outrage over the pay packages at big banks and brokerage firms.

And when 20% of the population doesn’t have decent paying work, somehow that just seems a little… unseemly. I’m not saying these guys aren’t ridiculously smart and hard working and don’t deserve compensation. But the sheer greed… well. It’s a little much to take.

This year’s top earner (as ranked by AR: Absolute Return+Alpha magazine) was David Tepper, who raked in $4 billion in 2009 by betting big that the government wouldn’t let the big banks fail. His investors didn’t do too shabby either, gaining 130 percent last year. Tepper was quoted in the New York Times as saying, “We bet on the country’s revival. Those who keep their heads while others are panicking usually do well.”

George Soros came in second in terms of earnings with $3.3 billion in fees and investment gains. His fund grew 29 percent in 2009.

Still, the success of these few hedge fund managers is not representative of the entire industry. Big gains were not a constant last year. In fact, industry experts say there is a widening gap between winning and losing funds.

According to the New York Times,

For many of the top 25, the big personal gains in 2009 came after steep losses in 2008. Half of the top 10 managers in 2009 lost money the year before, including Mr. Tepper, whose flagship fund, Appaloosa Investment Fund I, dropped 27 percent in 2008….

Three managers among the top 10 — Mr. Soros (No. 2), James Simons (No. 3) and John Paulson (No. 4) — were back-to-back winners, having profited during the lean times of 2008 as well as in the booming market of 2009.

It remains to be seen if Washington (or any external influences, such as the E.U.’s proposed AIFM directive or this summer’s G20 summit) will seek to limit hedge fund pay days. According to a Washington Post article,

When the Obama administration imposed restrictions on executive pay last year at some of the largest companies the government had bailed out, officials said they were aiming to set a new standard for compensation across corporate America that would discourage risky business practices.

But as firms begin to disclose last year’s bonuses ahead of annual shareholder meetings, it is becoming clear that companies across a wide range of industries are paying executives in ways that officials worry will not discourage the kind of excessive short-term risk-taking that led to the financial crisis.

The Treasury Department said it is not looking to limit the total pay executives receive. Kenneth R. Feinberg, President Obama’s special master for compensation, wants to change pay incentives, giving executives a greater stake in the long-term performance of their firms. That would mean, for example, smaller up-front cash salaries and fewer perks, more compensation in the form of company stock and a longer wait to receive it.

My guess is that little will be done to limit compensation because the rich are powerful. My hope is that those who have more money than god feel a pang of conscience and give some of the money to charity (or just do it for the tax write off at the very least).