Investors were provided with faked returns amid fraudulent activity
A former Canadian hedge fund trader misled investors with faked returns regarding their investments and has been jailed for fraud and for trading securities without registration.
Nathanael Anthony Aikman was charged by the Ontario Securities Commission under the Securities Act (Ontario) after it was discovered that he fabricated returns from trading activities at Yonge Street Capital LLC (YSC), a purported hedge fund that he co-founded.
From 2016 until 2019, Aikman handled more than $6 million in investments by 71 individuals, with a guarantee of 25% returns, but a large share of the money was used for purposes unrelated to YSC and to the detriment of the investors. Aikman admitted faking the returns in a hearing at the Ontario Court of Justice in Ontario in November 2023, and also admitted trading securities without registration.
This week Aikman was sentenced to four years in jail and ordered to pay more than $3.9 million in restitutions.
Aikman’s Yonge Street partners, Syed Saad Aziz and Jazib Ali Khan, were also charged but were not found guilty of fraud. It emerged that they did not have access to the firm’s brokerage account and were only able to monitor performance through a spreadsheet.
The partners made a complaint to York Regional Police in August 2019 that Aikman had had provided false information about YSC’s monthly returns and had lost all the investors’ money.
They also emailed investors stating that Aikman had “manipulated, lost, and/or stolen most (if not all) of the funds of YSC” and that “Aikman admitted to both of us that for over two years he had been
falsifying information in relation to your accounts” according to the Statement of Allegations.
While not guilty of fraud, Aziz pled guilty to one count of unregistered trading on August 3, 2021, later receiving a two-year probation order. He also agreed to cease trading in securities for a period of 10 years and disgorge $60,000. Khan was convicted of unregistered trading and illegal distribution on July 15, 2022, and was later given a suspended sentence and a two-year probation order.
