Over a year ago we reported that one of Twitter early and most aggressive self-promoters, Anthony Davian, was busted for what was at the time financial Twitters' the first Ponzi Scheme. In our words then [7]:
Once upon a time there was a Twitter-based, pump-and-dumping daytrading bucket shop posing as a "successful hedge fund manager" also known as Davian Letter/Davian Capital Advisors run by an Ohio gentleman known as Anthony Davian, which for reasons unknown even managed to run outside capital (somehow raking up to $1.5 million in idiot AUM, mostly courtesy of his very aggressive self promotion on Twitter using the @hedgieguy handle), and which didn't like Zero Hedge much.
[8]
(but that's ok because the feeling was mutual - we had advised the SEC in late 2009 that the Davian operation was nothing but a ponzi scheme).
A few years later, said outside capital is gone (with losses that could have been prevented had the SEC moved earlier) and moments ago, following a four year delay since our notice, the SEC has finally acted and charged Anthony Davian with fraud.
Today, we can close the case on Athony Davian.
As SIRF reports [9], "Anthony Davian, a once-prolific presence on social media who held himself out as a iconoclastic hedge fund manager prior to his August 2013 indictment on a series of fraud charges, was sentenced several hours ago in a Cleveland courtroom to four years and nine months in federal prison."
The details of the sentencing courtesy of SIRF's Roddy Boyd [9]:
Anthony Davian, a once-prolific presence on social media who held himself out as a iconoclastic hedge fund manager prior to his August 2013 indictment [10] on a series of fraud charges, was sentenced several hours ago in a Cleveland courtroom to four years and nine months in federal prison.
Federal Judge Patricia Gaughan of Ohio's Northern District court also ordered Davian to make restitution of approximately $1.8 million to his defrauded investors and serve three years of probation after his release. Should Davian waive his right to appeal, he is slated to report to prison in late December or early January, pending his recovery from a recent foot surgery [11].
According to a pre-sentencing guideline federal prosecutors filed [12] on November 18th, they sought a 60 month sentence (and full restitution) for Davian based on an investigation they claimed showed Davian had never sought to manage money, but only to raise investor capital to fund personal and business expenses, including paying off an office lease and attorney fees.
A once forceful presence on what is now known broadly as "Finance Twitter," Davian's signature remark was "Ching!" (after a trade he had been discussing allegedly turned profitable for his portfolio,) he was the subject of a July 2013 Southern Investigative Reporting Foundation investigation [13] that raised doubts about his performance and whether he was even managing the several hundred million dollars he then publicly claimed.
In the weeks after SIRF's report was released, lawyers from the Security and Exchange Commission and the Department of Justice filed claims [14] in federal court to shut Davian's portfolios down and seize assets. Apart from an expensive Audi and a Bath, Ohio property where Davian sought to build a mansion, there was apparently little for government lawyers to seize.
In the courtroom, according to notes given to SIRF by someone present in the courtroom who asked not to be identified because he sought "to put this behind me," Davian's wife and mother made statements that sought mercy from Judge Gaughan before the sentence was entered. His mother discussed what she argued was Davian's long history of mental illness; his wife said that all of their children had substantive medical issues that were "drowning them in medical expenses."
And now we look forward to which self-acclaimed "successful hedge-fund manager" on Twitter will take his place.
