Operator of fake hedge fund sentenced to 63 months in prison

Benjamin Koifman, who pleaded guilty to conspiracy for his role in a scheme to cheat investors with a phony New York-based hedge fund, was sentenced to five years and three months in prison.

Prosecutors in the office of Manhattan U.S. Attorney Preet Bharara claimed Koifman and William Shternfeld ran A.R. Capital Global Fund LP, an unregistered investment adviser, and ARC Global Fund, a hedge fund that claimed to invest in equity of international real estate.

Koifman was sentenced by U.S. District Judge Sidney Stein in a hearing in Manhattan today. Shternfeld is scheduled to be sentenced later today.

Prosecutors claimed that, from 2004 to 2006, Shternfeld and Koifman engaged in a scheme with co-conspirators to get at least 70 investors to invest about $20 million in the ARC Global Fund by making false statements about it.

Two other men in the case, Igor Levin of Brooklyn, New York, and Yevgeny Shvartsshteyn of Belle Harbor, New York, pleaded guilty to conspiracy in December.

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