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You may have lost money in your investment portfolio,
due to mismanagement and not even know it.

Case illustrates why Wall Street feared, despised by many Americans

"[E]ven sophisticated institutional investors are not immune to financial scams," noted an official with the U.S. Securities and Exchange Commission earlier this week regarding a high-profile investment scam that is rapidly gaining national news traction.

The material details underscoring what has emerged as a major investment fraud fleecing of a hedge fund foundation and other parties patently illustrate the widespread public antipathy that is clearly on display these days toward many Wall Street investment arms and principals.

A New York Times article also notes that they highlight "the broader issue of how much research and checking institutional investors actually do when making an investment."

In the case being discussed today, investors clearly didn't do much checking at all. Indeed, they reportedly handed over scores of millions of dollars to Andrew Caspersen, a well-known Wall Street investor and business insider with deep and long-tenured industry connections that inspired trust rather than prompted any close scrutiny.

That was not wise, securities authorities say, given that an investment company established by Caspersen was a sham entity and entirely bogus. When the scheme fully unraveled and was discovered, the account holding $25 million given by the aforementioned hedge fund foundation reportedly had only about $40,000 in it. Investigators say that Caspersen spent most of the money he received on "aggressive options trading" in a personal account.

Caspersen was arrested last Saturday and criminally charged by federal prosecutors with securities and wire fraud. The SEC has also filed civil charges in the case.

He was subsequently released on a $5 million bond, pending trial.

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