Fredrick Douglas Scott was named one of Ebony magazine’s “Top 30 under 30″, claiming to be the youngest African-American to found a hedge fund. In April 23, 2012, his company, ACI Capital Group, filed a Form ADV showing $3.7 billion in assets under management.
It was a lie and Mr. Scott is a thief.
Perhaps the SEC should have noticed the red flag when ACI’s AUM increased dramatically to $3.7 billion. One month earlier, ACI had filed a Form ADV with $100 million in assets under management.
According to the SEC complaint, the $3.7 billion consisted of illiquid foreign bonds, rights to real property in the Republic of Cameroon and Guadalajara, Mexico, and a Honduran mine. The complaint, among many charges, contains a charge of violation of Section 203A of the Investment Advisers Act for registering with the SEC instead of the state regulators since he actually had less than $25 million in assets under management.
Of course it is up to the SEC to prove the charges. However, Mr. Scott already plead guilty to wire fraud conspiracy to steal over $1 million from investors and lying to official from the SEC.
“Fredrick Douglas Scott admitted that he used ACI Capital to steal his clients’ investments and fund his own lavish lifestyle. Rather than the historic figure he presented to the media, Scott stands revealed as a common thief who lied his way into his investors’ pockets and then continued his web of lies when confronted by the SEC. Scott has now been brought to justice for lying, cheating, and stealing for his own personal financial gain.”
United States Attorney Loretta E. Lynch.