Boston Provident Trader Ezra Levy Arrested for Theft

http://www.bloomberg.com/apps/news?pid=20601087&sid=aTrTK9F_ZJZk&pos=6

Nov. 10 (Bloomberg) -- Ezra Levy, a hedge fund trader at Boston Provident Partners LP, was arrested on federal charges that he stole more than $1.3 million from the Manhattan-based firm.

Prosecutors accused Levy in a criminal complaint of two schemes to defraud Boston Provident, run by Orin Kramer, the chairman of the New Jersey State Investment Council. Levy transferred $726,000 from Boston Provident to his bank accounts and had the fund buy shares of Atlas Energy Inc. at inflated prices from an account he controlled, generating a $600,000 profit, according to the complaint.

Levy is accused of participating in the schemes from January to October with other people who weren’t identified in the 11-count securities-fraud and wire-fraud complaint. Levy, Boston Provident’s chief trader and chief financial officer, is scheduled to appear in Manhattan federal court later today.

“Boston Provident terminated Mr. Levy immediately after learning about this outrageous conduct, and Mr. Kramer contacted the U.S. Attorney,” the firm said in a statement today. “This is an egregious violation of the law and the trust of our investors.”

Kramer will cover the firm’s losses and fees from the alleged crime, the statement said.

“The restitution will increase previously reported investment returns for the firm’s limited partners,” the statement said.

Levy made wire transfers to his bank account of about $66,000 each throughout the year, according to the complaint.

Atlas Energy, of Moon Township, Pennsylvania, develops, produces and transports natural gas and oil in the U.S.’s Appalachian Basin.

The case is U.S. v. Levy, 09-mg-2472, U.S. District Court, Southern District of New York (Manhattan).