Category: Hedge Funds

New Jersey Freaks as David Tepper Packs Bags to Florida

Hedge fund titan David Tepper is sick and tired of paying nosebleed-high income taxes in New Jersey and has now made Florida the permanent home for his hedge fund and himself.  Now state revenue officials in high income tax states are freaking out.

From Bloomberg:

Tepper, 58, registered to vote in Florida in October, listing a Miami Beach condominium as his permanent address, and in December filed a court document declaring that he is now a resident of the state. On Jan. 1, he relocated his Appaloosa Management from New Jersey to Florida, which is free of personal-income and estate taxes.

His move has state revenue officials on alert.

“We may be facing an unusual degree of income-tax forecast risk,” Frank Haines, budget and finance officer with the Office of Legislative Services told a Senate committee Tuesday in Trenton.

Some 40% of New Jersey’s revenue comes from personal income taxes so it’s a big deal.  Top earners in the state can pay up to 9%.

With zero personal income tax in Florida it is no wonder Mr. Tepper and other hedge funds are looking to set-up shop in Florida and other tax-friendly states, both professionally and and personally.

There will likely be no end to the exodus of capital from highly-taxed states.

Wall Street Partner Bilks Investors Out of $25M, Sought Another $70M

Fraud and Wall Street… the two go hand and hand and today was no exception.

Andrew Caspersen of PJT Partners was charged with a $95 million scheme to defraud investors, according to reports.

Caspersen, 39, was arrested on Saturday and is expected to appear in federal court later on Monday. His lawyer did not immediately respond to a request for comment.

Prosecutors said that beginning in July 2015, Caspersen fraudulently solicited investments by falsely claiming he had authority to conduct deals on behalf of his employer with another private equity fund.

Authorities said Caspersen obtained $25 million from a foundation affiliated with a New York hedge fund and one of the fund’s employees claiming their investment would be secured by $900 million of assets of Irving Place Capital Partners III SPV.

Instead, Caspersen took control of the funds for his own use, trading securities in his personal brokerage account, and largely lost the money due to aggressive options trading, prosecutors said.

Shortly before his arrest, Caspersen sought another $20 million from the same foundation and $50 million from another New York private equity firm, prosecutors said.

PJT said it was “stunned and outraged to learn of the fraudulent circumvention and violation of the firm’s compliance policies and ethical standards.”

Shares of PJT collapsed over 20% on the news before recovering modestly.

Can Bill Ackman Save Valeant?

Hedge fund kingpin Bill Ackman just went all in on Valeant (NYSE: VRX) and it could make or break his career.

Owning over 30 million shares near the highs, Ackman is down several billion dollars on the disastrous trade.

Today, Ackman forced the ouster of CEO Michael Pearson and was himself appointed to the board. It is now very personal, as it should be with his hedge fund and reputation on the line. Continue reading “Can Bill Ackman Save Valeant?”