Park Hill Ex-Partner Charged with $95M Fraud

Andrew CaspersenA Park Hill Group private equity executive has been charged with scheming to defraud institutional investors of more than $95 million.

Andrew Caspersen—a managing principal at the Park Hill Group until his dismissal earlier this month—allegedly stole money through fake private equity funds from at least July 2015 to March 2016, US prosecutors said.

Park Hill is a secondaries advisory firm and placement agent unit of PJT Partners.

Caspersen took a $25 million investment from a charitable foundation affiliated with a New York-based hedge fund for his personal use, according to the US Attorney’s Office for the Southern District of New York. He also took a $400,000 investment from an employee at the hedge fund.

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Caspersen used a portion of the stolen $25 million to trade securities in his personal account, the prosecutors continued, “funds he largely lost as a result of aggressive options trading.”

The 39-year-old attempted to solicit another $70 million from the foundation and a private equity firm before the prosecutor arrested and charged him with securities and wire fraud late this month.

“To advance his $95 million fraud scheme, Caspersen allegedly put on a shameful charade—creating fake email addresses, setting up misleading domain names, and inventing fictional financiers,” US Attorney Preet Bharara said in a statement.

The US Securities and Exchange Commission (SEC) also charged Caspersen with fraud.

“As alleged, Caspersen engaged in a brazen fraud by raising money under false pretenses and simply stealing the funds,” said Andrew Calamari, director of the SEC’s New York regional office. “This action amply demonstrates that even sophisticated institutional investors are not immune to financial scams.”

“This action amply demonstrates that even sophisticated institutional investors are not immune to financial scams.”PJT Partners—a spin-off of Blackstone—told CIO that it has terminated Caspersen since discovering his alleged illegal activities.

“We were stunned and outraged to learn of the fraudulent circumvention and violation of the firm’s compliance policies and ethical standards,” the spokesperson said. “Our firm’s reputation for ethical behavior is fundamental to our business.”

After learning of Caspersen’s “improper behavior,” PJT said it launched an internal investigation and brought it to the attention of the US Attorney’s Office.

Park Hill has assisted with private equity sales for multiple public pension plans over the last few years. The California Public Employees’ Retirement System hired Park Hill to offload its $3 billion real estate portfolio in June 2015. The Florida pension plan and the Illinois Teachers’ Retirement System also tapped the placement agent to sell their private equity portfolios.

Prior to his three-year tenure at Park Hill, Caspersen spent nine years as a principal at secondaries firm Coller Capital, according to his LinkedIn profile. He is also a Harvard Law School and Princeton University graduate.

Cornell AJ Edwards AJ Edwards, Cornell UniversityCornell University’s CIO AJ Edwards will be stepping down effective March 31, the Ivy League school announced.

Edwards has spent eight years at the $6 billion endowment, first joining as a senior investment officer. He was then named CIO in May 2012.

He is the third CIO to resign in the last six years. James Walsh stepped down from his post in 2010 after four years, and Walsh’s successor Michael Abbott suddenly resigned in 2011 just six months into the job. “It had become apparent that his style of conducting business is inconsistent with Cornell’s policies and expectations,” the university said about Abbott’s exit.

The endowment has appointed senior investment officers Cody Danks Burke and Roger Vincent as interim-CIOs. The university is expected to select Edward’s permanent replacement by April 15.

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“The endowment has had well over $3 billion in investment gains since the depths of the recession,” the outgoing investment chief told the Cornell Chronicle. “The investment office today is very strong, and I am proud that the quality of the staff has improved over the last several years through internal promotions and recruiting at all levels.”

Cornell’s CFO Joanne DeStefano also praised Edwards’ ability to help the endowment recover from the 2008 crisis, and said he has been “active in identifying new markets in which to invest.”

During his tenure, Edwards also improved the investment office’s internal decision-making process and implemented a new research management system.

Prior to his time at Cornell, Edwards managed the pension plan at Northeast Utilities (now-Eversource Energy). He also served in various positions in equity management at Connecticut-based Wright Investors’ Service.

He holds an MBA in finance from the University of Connecticut and a master’s in mathematics from Fairfield University.