Just how sloppy is Paradigm Global?

Paradigm Global is a fund of hedge funds owned and controlled by Hunter Biden and James Biden.  Hunter and James are the Vice President’s son and brother respectively.

The SEC recently alleged a fraud by Ponta Negra – a small hedge fund run out of an office in Stamford Connecticut.  This blog first observed that Ponta Negra also maintained an office with Paradigm Global.

Moreover in SEC filings they gave their phone number as the Paradigm Global switch and they used the same marketer as Paradigm Global.

This was first exposed on this blog here.  Read this post first.

Now Paradigm have – through their lawyer – sought to defuse this issue.  Their lawyer summed up the story as follows (as reported in the Politico):

"They were subtenants," he said, adding that marketer Jeff Schneider "who did some marketing for paradigm over the last couple of years introduced us to Ponte Negra, and we had some available office space."

"That's 100% the extent of the relationship," he said.

"There's no smoke or fire as relates to this unfortunate Ponte Negra situation. There's nothing there at all," he said.

Jeff Schneider was a full time employee of Paradigm (according to their own marketing material) until relatively recently (January 2004 to February 2008 according to FINRA records).  To say that he did some marketing for Paradigm over the last few years is understating the extent of the relationship.

Anyway the excuse is that Ponta Negra is a subtenant – and in no way associated with Paradigm.

The excuse comes down to Paradigm being careless about their reputation rather than in any way involved in the alleged Ponta Negra fraud.

And I admit it – the only hard evidence I have is for Paradigm being unduly careless about their reputation.  

And in this light I thought I might have a look at just how careless by looking at Jeff Schneider’s FINRA record.  Jeff Schneider it seems has a history that might make him difficult to employ by anyone who does thorough due diligence and cares about their reputation.  

Remember this guy was a full time employee in a senior position at Paradigm. 

• Whilst working for CIBC markets immediately before taking the position at Paradigm he allegedly temporarily transferred securities from a customer account to another member of the firm allowing the other member of the firm a bonus.  He is acused of but denies sharing in this bonus.  He settled this for a fine, a non-admission of guilt and a 90 day industry suspension.  

• There were several allegations that at CIBC he recommended inappropriate investments and excessively traded client accounts.  Damages in most these cases was under half a million dollars and some cases were settled by CIBC for amounts up to one hundred thousand dollars.

• There were also allegations of unauthorised trading of client accounts which were settled by CIBC for amounts in excess of $50 thousand.
  

Needless to say he was dismissed by CIBC.

• At Paine Weber he was accused of failing to respond to client requests causing damages to clients of $18000.  Paine Weber settled for $10 thousand but Mr Schneider denies any liability.

• He was permitted to resign from Merrill Lynch after allowing foreign clients to exercise (losing) trades and to not pay for their losses.  He argues that he was following Merrill Lynch procedures and that the clients just disappeared.
  

You can find the details here in his FINRA report.

Given this history are you surprised that Jeff Schneider is the marketing agent for Ponta Negra – an alleged scam?  

Or are you more surprised that a firm owned by the Vice President’s son and brother continued to employ Jeff Schneider as a marketing agent?

At best the Biden’s firm is sloppy.  Sloppy enough that it is highly surprising that the main stream media is not asking questions.

John

PS.  I am a life-long adherent of slightly left-of-centre politics.  I campaigned against John Howard in his own electorate and was (proudly) at Maxine McKew's election party when she pulled off the improbable win.

I would have donated to the Obama campaign except that - for a non-US citizen - that would be illegal.  My problem with Obama is that he is too centrist.

If the election were held again tomorrow and I could vote it would be for Obama/Biden.

There are some people aruging I am writing these posts because of some right wing political agenda.  They are just wrong.  

This issue just deserves exposure.  I did not set out to expose the Bidens.  I found Ponta Negra and followed where it led me.  I almost collapsed in surprise when I found the strong Biden link.  

J