• By The Financial District

Prosecutors File Raps vs NYC Investment Adviser For $5B Fraud

Bus drivers, subway conductors, and religious groups nationwide lost over $5 billion when a COVID-induced stock market collapse crushed private investment funds linked to a financial industry giant, exposing massive fraud, authorities said Tuesday), Larry Neumeister reported for the Associated Press (AP).


Photo Insert: Allianz Global Investors (AGI) US LLC, a New York City-based investment adviser, failed to reveal to the SEC an “egregious, long-running and expensive fraud."



US Attorney Damian Williams said his office took the rare step of bringing criminal charges against Allianz Global Investors (AGI) US LLC, a New York City-based investment adviser, in part because the company failed to reveal an “egregious, long-running and expensive fraud” before the Securities and Exchange Commission (SEC) discovered it.


"Make sure you call us before we call you,” Williams told a news conference, vowing to remain “relentless in rooting out corruption in our financial markets.”



As part of a deal with prosecutors, Allianz Global Investors US LLC agreed to plead guilty Tuesday to its role in a fraud stretching from 2014 to 2020 and pay $3.2 billion in restitution, a $2.3 billion fine, and forfeit $463 million. Prosecutors called it one of the most significant corporate resolutions in history.


AGI US is an indirect, wholly-owned subsidiary of the Munich, Germany-based Allianz SE, one of the world’s largest financial services and insurance companies.


All the news: Business man in suit and tie smiling and reading a newspaper near the financial district.

The prosecutor also announced conspiracy, securities fraud, and obstruction of justice charges against Gregoire Tournant, 55, of Basalt, Colorado, the former chief investment officer for a series of funds at AGI US that was once worth $11 billion.


Two other men blamed for the fraud have pleaded guilty and are cooperating, Williams said. Williams said Tournant and his co-conspirators lied to investors and secretly exposed them to substantial risk to illegally profit.



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