The Persian-Jewish proprietor of a bogus hedge fund under investigation by the Securities and Exchange Commission is a prolific Democratic donor who dined at the Obama White House just months before the SEC shut down his Ponzi scheme.
Shervin Neman, a self-described hedge fund manager in Los Angeles, is said to have targeted members of his own Persian-Jewish community in a $7.54 million Ponzi scheme that the SEC claims "raised funds from at least 11 investors in the fraudulent securities offering."
Neman, the SEC alleges, raised funds by fictitiously claiming he was a hedge fund manager with Neman Financial L.P. After collecting monies from unsuspecting investors, Neman claimed to have invested the money in high-grossing entities such as Facebook stock and foreclosed residential properties.
"Although Neman promised investors exorbitant returns resulting from his investing acumen and access to pre-IPO shares of well-known companies, what they actually received was simply other investors’ monies, the hallmark of a Ponzi scheme," the SEC alleged in a statement on the matter.
His association with the president also raises questions about how team Obama will handle donations made by questionable supporters.
The alleged swindler donated $35,800 to the Obama Victory Fund and DNC in the second fundraising quarter of 2011, according to FEC filings. He also donated generously to Sen. Dianne Feinstein’s (D-Calif.) re-election fund, as well as to several other Democratic causes. In each of the donations, Neman describes himself as either a "hedge fund manager" or the CEO of Neman Financial.
It remains unclear whether the donations came from Neman’s personal coffers or from his company.
Also listed as a donor to team Obama is Neman’s wife, Cassandra, who donated $5,000 and $30,800 to the Obama campaign and Democratic National Committee respectively. She is described as the owner of Virago PR & Management.
While the PR firm does not have a large web presence, its owner is alleged to have reportedly stolen thousands of dollars from a California high school.
Cassandra Neman, who is referred to by the name Cassandra Grill in the report, was hired to help a high school senior class with its prom, according to KTVU in California. Instead, the event planner skipped town with around $6,500 of the students’ money.
The ongoing SEC case against Neman alleges that he preyed on members of the Jewish community in which he often traveled.
"The Commission alleges that more than 99 percent of the money Neman raised was used either to pay returns to existing investors, or to fund his lavish lifestyle," the SEC said. "According to the Commission, Neman spent nearly $1.6 million of investor funds to buy jewelry, pay for his wedding and honeymoon, as well as high-end cars, VIP tickets to sporting events, and vacations."
Neman’s wife is also named "as a relief defendant, seeking disgorgement of her ill-gotten gains."
A preliminary court hearing on the matter was scheduled to take place Monday.
UPDATE: The original headline of this story incorrectly identified Neman as an Obama bundler.
UPDATE: Politico reported Wednesday afternoon that the Obama campaign will return Neman's donations. The WFB will update as to the monies Neman donated to other Democrats.
Published under: Democratic Donors