Lake Shore Group

Arrest warrant against Philip Baker for alleged fraud and embezzlement.

Two former officers of a U. S.-based investment adviser have been accused of perpetrating a "massive fraud" against clients, who include an offshore bank and several offshore hedge funds.The conduct of Eric A. Bloom, 42, a resident of Northbrook, Illinois, and Charles K. Mosley, 43, a resident of Vernon Hills, Illinois, caused the loss of "several hundred million dollars" of approximately $1.4 billion of assets under management that their Chicago-based firm, Sentinel Management Group Inc., had at the time it filed for bankruptcy last year, according to the U. S. Securities and Exchange Commission.

Eight companies domiciled in the British Virgin Islands, four in the Turks and Caicos Islands, and one each in the United States and the United Kingdom have been added as parties in litigation brought by the U. S. Commodity Futures Trading Commission against the Lake Shore group of hedge funds.

A management agreement between a Bermuda corporate services provider and a hedge fund group accused of committing a $100 million-plus fraud against investors was back-dated by two weeks in an attempt to circumvent a restraining order issued by a U. S. federal court, a regulator has claimed. The contract pursuant to which Bermuda-based Mercury Group Limited agreed to provide "office and related facilities and services" to the Lake Shore group was, in reality, entered into on June 29, 2007 - the same day that 38 boxes of Lake Shore records were transferred from Roth Mosey & Partners LP accounting and consulting firm in Canada to MGL in Bermuda, according to the Commodity Futures Trading Commission in a filing on January 9, 2008 at the U. S. District Court for the Northern District of Illinois, where it is suing Lake Shore and its principal, Philip Baker, for fraud.

The Lake Shore group of offshore investment funds appears to be insolvent by more than $100 million, according to its Receiver, Robb Evans & Associates LLC.In its first Receiver's report that was filed at the U. S. District Court for the Northern District of Illinois on December 5, 2007, Robb Evans painted a gloomy picture for investors and creditors of the group, whose funds were domiciled in the British Virgin Islands and the Turks and Caicos Islands and managed by a Bermuda company.

A bank and seven investment funds all domiciled in Caribbean countries are among the 20 largest unsecured creditors of a U. S. based investment adviser that has filed for bankruptcy in Chicago and is being sued for fraud by the

A contempt of court motion has been filed in the United States against a Bermuda-based firm that manages several hedge funds registered in the British Virgin Islands and also has ties to Canada and Switzerland.Lake Shore Asset Management Limited, which is believed to manage at least $466 million, has refused to turn over documents to the Commodity Futures Trading Commission in breach of a Statutory Ex-Parte Restraining Order issued seven days earlier, stated the regulator in its contempt motion at the U. S. District Court for the Northern District of Illinois on July 3, 2007.