October 4, 2022
Loading...
You are here:  Home  >  Current Article

Phone call to Westridge Capital Management prompts police response

IN THIS ARTICLE

The sign at Westridge Capital Management’s offices was ripped off the door and a Santa Barbara Police officer greeted visitors on Feb. 26 as details emerged about the company and two New York men who are accused of misappropriating more than $550 million from investors.

Officials were tight-lipped about Westridge as well as Santa Barbara men James Carder and Mark Yeager, who apparently ran the day-to-day operations of the Santa Barbara-based company. Westridge had 20 clients and $1.8 billion under management, SEC records show.

At the firm’s office on Carrillo Street, Yeager declined to comment. A Santa Barbara police officer was with Yeager at the office.

“Our officers responded to document an incident concerning a telephone call the business received,” said Sgt. Lorenzo Duarte, a spokesman for the Santa Barbara police. Duarte said he couldn’t give any further details until the officer’s report had been reviewed.

No charges have been disclosed against either Yeager or Carder.

On Feb. 25, FBI agents in New York arrested Paul Greenwood and Stephen Walsh, who were the principals of Westridge Capital Management and a cluster of related companies. The FBI charged the men with fraud while the Securities and Exchange Commission filed a civil complaint accusing them of misappropriating more than $550 million.

Greenwood and Walsh controlled Westridge Capital Management, the SEC’s complaint said. Carder has been the firm’s chief compliance officer since 2007 and its president since 1983, SEC records show. It’s not yet known what Yeager’s role in the firm was. Carder was not in the office on Feb. 26.

An FBI spokeswoman said she couldn’t comment on Carder or Yeager and added that federal law enforcement officials haven’t announced any charges against them.

The SEC froze the Greenwood and Walsh’s investment activities after they took $21 million from the University of Pittsburgh on Feb. 6 and didn’t respond to its calls about the money. It alleges Westridge and the two men’s other firms ran a fraudulent investment scheme since 1996.

“Greenwood and Walsh have used client money invested in [WG Trading Investors, a sister company to Westridge Capital Management] as their personal piggy-bank to furnish lavish and luxurious lifestyles, which include the purchase of multi-million dollar homes, a horse farm, cars, horses and rare collectibles such as Steiff teddy bears,” the SEC complaint said.

The SEC and FBI actions came five days after the University of Pittsburgh and Carnegie Mellon University filed a civil suit against Westridge Capital Management in federal court. That suit had alleged the men misled the universities and lost them $114 million.

The universities filed suit after the National Futures Association had audited Greenwood and Walsh Feb. 5. After the men didn’t cooperate with the audit, the regulatory agency suspended their futures trading licenses.

The next day, Greenwood and Walsh solicited the $21 million from the University of Pittsburgh, but then didn’t respond to the school’s requests for information about the money, prompting it to file its lawsuit.

-To read the SEC’s complaint against Westridge Capital Management, click here.

-To read Carnegie Mellon University and the University of Pittsburgh’s complaint against Westridge Capital Management, click here.

This story was updated at 2:30 p.m. Feb. 26.

Are you a subscriber? If not, sign up today and get four free issues of the Pacific Coast Business Times!