The Securities and Exchange Commission charged a Minneapolis hedge fund manager, his investment advisory firm Archer Advisors LLC, and his assistant with defrauding investors in two hedge funds out of over $1 million by charging fake research and expense fees, the agency announced Monday.
The firm’s owner, Steven Markusen, allegedly funneled the money into a personal checking account, spending it on boarding school tuition, country club membership fees and a Lexus, according to the SEC. Markusen and employee Jay Cope implemented the “fake fee” scheme as Archer’s management fees were declining due to poor performance, the agency added.
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