Spitzer's jurisdiction over non-US hedge funds

F

Foz

Here's the news item...

Spitzer Widens Investigation of Hedge Fund Late Trades
By Chidem Kurdas, New York Bureau Chief

Tuesday, September 09, 2003

NEW YORK (HedgeWorld.com)— New York attorney general Eliot Spitzer’s office subpoenaed around a dozen additional hedge funds in the ongoing inquiry into the trading of mutual fund stocks.

Tewksbury Capital Management is among the firms required to provide information on after-hours and short-term trading of mutual fund shares—a special privilege allowed by mutual fund companies under quid pro quo arrangements that harmed long-term shareholders, according to the attorney general. Monroe Trout sold multi-billion dollar Tewksbury, formerly Trout Trading Management Co. Ltd., to chief executive Matthew Tewksbury last year.

etc. etc.
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Why would or should Tewksbury respond to the NY attorney general's subpoena? Tewksbury is a Bermuda company without US operations (that I know of). Not being a lawyer, I would think Spitzer only has power over the mutual funds allowing the late trades and then only if those mutual funds have NY investors.

What would happen if Tewksbury just refused to cooperate with Spitzer?
 
If they conduct business in NY State they are subject to the laws and regulations of NYS, including and not limited to the exchange of securities. Get it?
 
Quote from Foz:

Here's the news item...



Why would or should Tewksbury respond to the NY attorney general's subpoena? Tewksbury is a Bermuda company without US operations (that I know of). Not being a lawyer, I would think Spitzer only has power over the mutual funds allowing the late trades and then only if those mutual funds have NY investors.

What would happen if Tewksbury just refused to cooperate with Spitzer?
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I'm guessing that their management company is NY based. Many offshore funds have domestic management companies.

But I like I said, it's just a guess.
 
Quote from slammajamma:

If they conduct business in NY State they are subject to the laws and regulations of NYS, including and not limited to the exchange of securities. Get it?
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What business are they conducting in NY State? No, I don't get it. Please elaborate. Unless Tewksbury is calling someone in NY to place his mutual fund trades I don't see what business he is doing in NY.
 
Quote from Dr. Zhivodka:




I'm guessing that their management company is NY based. Many offshore funds have domestic management companies.

But I like I said, it's just a guess.
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The management company is in Bermuda. Mr. Tewksbury and his employees are physically living and working in Bermuda.
 
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