The Werewolf of Wall Street

By now, everyone has heard something of the theft allegations the SEC has leveled against New York hedge fund manager Moazzam “Mark” Malik. This thirty-three year-old is alleged to have stolen about $850,000 from 16 investors, foreign and domestic, beginning in 2011.

New York’s Attorney General Eric Schneiderman has filed criminal charges against Mr. Malik, alleging the theft of one-quarter million dollars from five investors. Reports fail to clarify if these are five additional investors or a subset of those referenced in the SEC’s complaint.

Malik’s Qualifications

Mark Malik’s credentials consist of a stint as a former New York Police Department traffic agent, waiter, and security guard. According to Malik’s LinkedIn profile, he has managed Wolf Hedge Global since January 2009. Prior to his noteworthy accomplishment of becoming a hedge fund manager in his mid-twenties, his LinkedIn profile reflects a 4 month job with Merrill Lynch as a research associate between March and June of 2009 and as an investment advisor for JP Morgan Chase & Co. from December 2008 to March 2009 after stepping down from the portfolio manager position he held with John Thomas Financial for one year.

John Thomas Financial’s founder, Thomas Belesis, enjoyed no small amount of notoriety and, if Mr. Malik was indeed employed with Belisis’ firm, one can’t help wondering what he learned while in its employ.

How Does this Happen?

In the Internet age it is relatively inexpensive to construct a slick web site, create a social media persona, and spin yarns that few take time to vet. Hindsight is 20/20 but that said, anyone examining Mr. Malik’s LinkedIn profile should have occasioned a number of red flags brought about by several overt inconsistencies.

The fact that BarclayHedge recognized Malik’s fund with a Best Performance Award in June, 2011 (per his LinkedIn profile) and that Bloomberg once referred to him as a “rising star” almost excuses his victims from further criticism—but not quite.  No one should invest with a hedge fund firm until reasonable due diligence has been performed.

While there is no evidence that Bloomberg or BarclayHedge were among Malik’s alleged victims, monetarily speaking, both have lost a measure of credibility with investors and the financial community.

It is also possible that the SEC, with its high profile targeting of hedge fund firms, has given investors an inflated sense of safety. Naturally, the impression any reasonable person would have after reading the near daily parade of press regarding SEC actions against this hedge fund or SEC investigations of that trader, is that the regulators are on top of this industry. However, a hedge fund must have at least $25 million in assets under management  before it is required to register with the SEC.

What Bearing Does This Have on Jobs?

Primarily this … the pursuit of employment opportunities in the hedge fund industry must include a vetting of the firm and its principal(s). There is no upside to securing a position with a firm that operates outside the bounds of the law and common decency. If one’s name becomes associated with the likes of Wolf Hedge Global, for example, the career path is likely to suffer.

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