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Hauke receiver files suit to recover $600k from Arizona investor

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The receiver representing investors in the Ponzi scheme run by convicted money manager Keenan Hauke has sued to recover nearly $600,000 in improper payments made to an Arizona investment fund.

And he says he has a handful more investors to pursue.

Carmel attorney William Wendling Jr. filed suit in federal court in Indianapolis against Larcher Investments LP and one of its managers, David Larcher. Larcher is executive vice president of Vestar Development, a Phoenix-based real estate developer.

The lawsuit claims that Larcher deposited about $2 million into Hauke’s Fishers-based hedge fund, Samex Capital Partners LLC, through a series of payments and reinvested profits in 2002, 2004 and 2005.

Then, in 2008, Hauke wired Larcher nearly $2.6 million, describing the extra money as a gain on Larcher’s investments.

But Samex had not been generating legitimate investment returns since a real estate investment had gone sour in April 2004. Instead, Hauke was paying off earlier investors with money he raised from later investors.

As a result, Wendling claims, Larcher received $593,040 that actually came out of the pockets of other investors.

“I want this to be crystal clear: the people we’re asking money back from did nothing wrong,” Wendling said. But, he added, “whatever profits they received were not really profits.”

Larcher did not return a phone call seeking comment on the lawsuit.

Wendling was appointed receiver of Samex Capital in June but could not proceed with his work until the conclusion of investigations by the Indiana Secretary of State’s Securities Division and the FBI.

Hauke pleaded guilty to fraud in December and in March was sentenced to 10 years in prison. He also was ordered to make restitution of $7.1 million, the amount the court determined he swindled from 67 investors.

Wendling said he is still compiling the list of investors that, like Larcher, received payments that were higher than the amounts they originally invested and any legitimate gains their money generated before Hauke’s fraud began.

He expects to have discussions with “a handful” of other investors and, if necessary, also file lawsuits against them. In all, Wendling estimated, there are likely $1 million to $2 million in excess payouts that could possibly be recovered.

Prior to the fraud investigation, Hauke was a high-profile wealth manager who made regular appearances on CNBC, Fox Business Network, Bloomberg Television and Bloomberg Radio. He also wrote an investing column in IBJ.

This article original ran in the April 11, 2012, IBJ Daily. The Indianapolis Business Journal is a sister publication of Indiana Lawyer.

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  1. Well, maybe it's because they are unelected, and, they have a tendency to strike down laws by elected officials from all over the country. When you have been taught that "Democracy" is something almost sacred, then, you will have a tendency to frown on such imperious conduct. Lawyers get acculturated in law school into thinking that this is the very essence of high minded government, but to people who are more heavily than King George ever did, they may not like it. Thanks for the information.

  2. I pd for a bankruptcy years ago with Mr Stiles and just this week received a garnishment from my pay! He never filed it even though he told me he would! Don't let this guy practice law ever again!!!

  3. Excellent initiative on the part of the AG. Thankfully someone takes action against predators taking advantage of people who have already been through the wringer. Well done!

  4. Conour will never turn these funds over to his defrauded clients. He tearfully told the court, and his daughters dutifully pledged in interviews, that his first priority is to repay every dime of the money he stole from his clients. Judge Young bought it, much to the chagrin of Conour’s victims. Why would Conour need the $2,262 anyway? Taxpayers are now supporting him, paying for his housing, utilities, food, healthcare, and clothing. If Conour puts the money anywhere but in the restitution fund, he’s proved, once again, what a con artist he continues to be and that he has never had any intention of repaying his clients. Judge Young will be proven wrong... again; Conour has no remorse and the Judge is one of the many conned.

  5. Pass Legislation to require guilty defendants to pay for the costs of lab work, etc as part of court costs...

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