Oppenheimer & Co.

Oppenheimer maintains ties with investor accused of fraud

December 2, 2013: 2:22 PM ET

Oppenheimer & Co. wants to put its private equity scandal behind it. Well, sort of.

FORTUNE -- We're written a lot over the past couple of years about how a private equity unit of Oppenheimer & Co. once inflated the valuation of one of its investments, in order to help market a new fund. The SEC later charged Oppenheimer with misleading investors, and the firm agreed to pay a penalty, return money to investors and be censured. Also charged by the SEC was group head Brian Williamson, who is fighting the allegations.

When Williamson was charged back in August, I publicly wondered why Oppenheimer was continuing to let him manage firm assets via a third-party platform Williamson formed after spinning out of Oppenheimer. Oppenheimer said it was reviewing the complaint and allegations, but never issued a follow-up.

Now Fortune has obtained an investor letter that contains three new pieces of information:

  1. 1. Oppenheimer assumed control of the GP back in August;
  2. 2. The fund is fully committed, with a March 2013 IRR of 1.23%;
  3. 3. Oppenheimer has signed a consulting agreement with Williamson, to advise "on the various operational matters concerning the fund's portfolio."

In short, Oppenheimer just can't quit this guy.

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  • Is Oppenheimer now misleading itself on fraud?

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    FORTUNE -- More than a year ago, we reported on how a private equity unit of Oppenheimer & Co. had inflated the valuation of one of its investments, in order to help market a new fund. The SEC later charged Oppenheimer with misleading investors, and the firm agreed to pay a penalty, return money to investors and be censured.

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    FORTUNE -- The Securities & Exchange Commission today charged two units of Oppenheimer & Co. with misleading investors as to the value of its private equity investments.

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    - Mar 11, 2013 12:44 PM ET
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