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Former NY Fund Manager Pleads Guilty to Fraud Charges - USA - crime - fraud - Ponzi scheme - New York - NYC

Former NY Fund Manager Pleads Guilty to Fraud Charges

NEW YORK -- Former hedge-fund manager James Nicholson on Friday admitted to running a four-year Ponzi scheme that prosecutors say cost investors at least $150 million.

CHAD BRAY | The Wall Street Journal | Published: 12/11/2009 12:27

Mr. Nicholson, the former president and sole managing member of money-management firm Westgate Capital Management LLC, pleaded guilty to securities fraud, investment adviser fraud and mail fraud at a hearing before U.S. District Judge Richard J. Sullivan in Manhattan on Friday.

"I stand before you a man who is greatly ashamed," Mr. Nicholson said. "Words cannot explain how sorry I am. I take full responsibility."

Mr. Nicholson, of Saddle River, N.J., faces up to 20 years in prison on securities fraud and mail fraud charges.

Prosecutors from the U.S. Attorney's Office in Manhattan have alleged the scheme, which began in 2004, fell apart last December after a number of investors sought to redeem their investments following the arrest of convicted Ponzi scheme operator Bernard Madoff.

Checks to nearly two dozen investors totaling $5 million bounced in December, prosecutors said.

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