Allianz Pleads Guilty to Fraud and Agrees to Pay $5.8 Billion

Posted on May 25th, 2022 at 10:41 AM
Allianz Pleads Guilty to Fraud and Agrees to Pay $5.8 Billion

From the Desk of Jim Eccleston at Eccleston Law:

A unit of Allianz SE has agreed to plead guilty to securities fraud and pay $5.8 billion in fines and restitution following the collapse of a relatively low-risk pool of investment funds amidst pandemic volatility. 

The firm has agreed to pay $3.2 billion in restitution to investors in its Structured Alpha Funds as well as a $1 billion fine to the Securities and Exchange Commission (SEC). A former executive at Allianz, Gregoire Tournant, has been separately charged for his role in the alleged securities fraud, according to Manhattan U.S. Attorney Damian Williams. Tournant, who served as the former chief investment officer, assisted in overstating the degree of independent supervision that AGI was providing, misrepresented several risk mitigation strategies and altered documents to conceal the volatility of the funds, according to prosecutors. 

Despite being created to protect investors from a market downtown, the Structured Alpha hedge funds suffered substantial hits amidst volatility during the pandemic. During the first quarter of 2020, the Structured Alpha hedge funds lost between 49% and 97% of their value. Allianz subsequently liquidated two of the funds in March 2020, and has proceeded to liquidate others. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory, arbitration and disciplinary matters. Those investors who lost money in Structured Alpha Funds should contact us.

 
 

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