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Fund Manager With Ties To Miami, FL Charged In Multi-Million Dollar Securities Fraud Case

On April 23rd, 2021, the Securities and Exchange Commission (SEC) announced the filing of civil securities fraud charges against Andrew T. Franzone, a fund manager who has ties to Miami-Dade County, Florida. Mr. Franzone allegedly took in more than $38 million from at least 90 different investors in Florida, New York, and throughout the country. In this post, our Miami investment fraud attorneys highlight the key details of the SEC’s complaint against fund manager Andrew T. Franzone.

SEC Charges: Fund Manager Andrew T. Franzone

The SEC filed its complaint against fund manager Andrew T. Franzone in the United States District Court for the Southern District of New York. The relevant time period cited by the agency in this case is August 2014 through September 2019. During that time, the SEC alleges that Mr. Franzone owned and operated a private fund called FF Fund Management, LLC or FFM. The private placement investment fund was marketed to investors as maintaining a liquid portfolio of investments, with a focus on capital preservation and limiting risk.

However, the SEC contends that the reality was quite different. Beginning back in 2014, the FFM fund was invested primarily in illiquid assets, such as new start-up companies and real estate projects. For the most part, Mr. Franzone put investor money in companies controlled by his friends and close associates. While making material misrepresentations to investors about the nature and scope of investments, Mr. Franzone took in nearly $40 million for at least 90 different investors.

FF Fund Management, LLC Declared Bankruptcy in 2019 

In September of 2019, Mr. Franzone’s private FFM fund filed for Chapter 11 bankruptcy protection. At the time of the bankruptcy filing, the fund held just $175,000 of liquid investments. The SEC believes that:

  • Material misrepresentations were made when raising money from investors;
  • Conflicts of interest were not properly disclosed;
  • Assets held by FFM were misused by Mr. Franzone, including using investor money to pay personal expenses and maintain a private race car collection.

The SEC is Seeking All Appropriate Sanctions Against the Fund Manager 

The Securities and Exchange Commission is seeking all appropriate sanctions and remedies against Miami, FL area fund manager Andrew T. Franzone. This includes the imposition of civil financial penalties and disgorgement of ill-gotten profits. The federal agency is also seeking injunctive relief. Notably, in a parallel filing on the same day, the United States Attorney’s Office filed criminal securities fraud charges against this fund manager.

Speak to a Securities Fraud Attorney in Miami-Dade County, Florida

At ​Carlson & Associates, P.A., we are devoted to protecting the rights of investors. If you suffered losses because your financial advisor misappropriated funds or engaged in other misconduct, you need a skilled securities fraud attorney on your side. Compensation may be available for your investment losses. Get in touch with our Miami law office now for a confidential review and evaluation of your legal claim. We represent investors in Florida and beyond.


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