Michael has over 20 years of experience representing individual and small business plaintiffs against the world’s large financial institutions, including Visa, Mastercard, and Chase.
On January 23, 2020, TCA Fund Management Group announced that it is shutting down its main credit hedge fund, TCA Global Credit Master Fund. This comes after three TCA employees reportedly filed a whistleblower complaint with the SEC, alleging that the firm has been inflating its hedge fund’s assets and earnings since 2017. In addition, the SEC has launched a probe into TCA Management Fund Group Corp.’s accounting practices.
Did You Invest in TCA Global Credit Master Fund?
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TCA Shuts Down Global Credit Fund; SEC Probe Initiated
According to multiple media reports, TCA Fund Management Group is shutting down its main hedge fund following an ongoing SEC probe into its accounting practices, as well as a wave of customers seeking to redeem their investments. Citing a TCA letter to investors, Bloomberg Law states that the TCA Global Credit Fund “received redemption and withdrawal requests in excess” of the available cash. It is reported that it will take up to 18 months to liquidate all positions. As of December, the fund reportedly managed $516 million.
NBC News reports that according to former TCA employees, the SEC conducted an examination into TCA after the company reported more than $150 million in assets and found irregularities. NBC reports that following the SEC investigation,
TCA restated net asset values for the Global Master Credit Fund.
Some TCA employees were concerned that the SEC investigation did not covered the full-extent of TCA’s misconduct, according to NBC reports.
Whistleblowers Alleges TCA Fund Management Group Inflated Assets and Returns
Three employees of the TCA Fund Management Group have reportedly filed a whistleblower complaint with the SEC. According to NBC News, the complaint alleges that TCA Management Group has inflated its assets and returns since 2017.
While the company boasts $500 million in assets, the complaint alleges that in reality, the fund’s holdings total roughly $300 million. This would constitute a $200 million inflation of assets. Further, while the fund claims 7% to 8% in annual earnings, the whistleblowers allege that the holdings actually generate only 1.92% annually.
NBC News reports that whistleblowers allege there are two serious problems with TCA’s accounting. First, the company neglects to write off defaulted loans. Second, the fund has recorded investment banking fees, which it has not received, as revenue.
If the whistleblowers’ allegations are true, TCA’s revenue and asset reports may be extremely inflated.
TCA Global Credit Master Investors Reportedly "Stuck" in Fund
According to NBC News, some TCA investors have been unable to redeem their investments from the Global Credit Master Fund. The news source reports that one employee even claims to have seen an internal email indicating that TCA had declined to meet in full all redemption requests received from investors.
If you invested in TCA Global Credit Master Fund and remain stuck in your investment, incurred substantial losses, or believe that the investment was unsuitable for you, you may have a claim. Speak with an experienced securities lawyers to learn more about your options.
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Gibbs Law Group is currently investigating a number of bad investment products on behalf of shareholders. These products include:
- GPB Capital Funds
- Northstar Healthcare Income REIT
- Benefit Street Partners Realty Trust
- FS Credit Real Estate Income Trust–I
- The Parking REIT
- Cole Credit Property Trust III (“CCPT III”)
- Apple non-traded REIT
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