UK hedge fund to take on Securities and Exchange Commission

According to the SEC claim, Headstart “opened numerous accounts on behalf of the Headstart Fund at various US broker-dealers, and split Headstart Fund trades among multiple accounts to keep the size of the trades below the threshold and conceal the extent of Headstart Fund’s trading from US mutual fund companies”.

In essence, the SEC says Headstart tried to evade mutual funds’ efforts to prevent market timing by keeping its trades small and disguised – below the radar of those trying to stop such deals.

The commission claims Headstart opened more than 500 brokerage accounts with at least 10 broker-dealers “for the purpose of market timing US mutual funds”. It says Nasser, 39, “provided instructions to, or otherwise communicated with, registered representatives at US broker-dealers in order to direct Headstart Fund’s late trading and deceptive market timing of US mutual funds”.