Posted by on Feb 29, 2020 in Articles & Advice, Blog, Books, Columns, Featured |

Image Credit: Aviron.com

 

 

By Jason Zweig | Feb. 28, 2020 2:19 pm ET

 

Take a break from the market turmoil to ponder the drama at a little fund run by the world’s biggest asset manager. It involves allegations of fraud and forgery, not to mention a fund manager’s daughter landing a part in a movie the fund financed.

We’re talking about the BlackRock Multi-Sector Income Trust. In 2017, the fund, which at that time had $750 million in net assets, lent a tenth of that to a small, privately held movie company, Aviron Capital LLC. It was an unusually aggressive bet. By late 2019, the fund said the loan wasn’t worth anything, for a nearly $75 million loss. In December, it filed a lawsuit against Aviron and its owner, William Sadleir.

Mr. Sadleir denies committing fraud. He does, however, admit copying-and-pasting signatures of a BlackRock fund executive onto documents to accelerate the sale of $3.2 million in movie-revenue receivables on which the fund had exclusive claim.

 

To read the rest of the column:

https://www.wsj.com/articles/the-hollywood-drama-that-cost-a-blackrock-fund-75-million-11582917564

 

For further reading:

Books:

Benjamin Graham, The Intelligent Investor

Jason Zweig,The Devil’s Financial Dictionary

Jason Zweig, Your Money and Your Brain

Jason Zweig, The Little Book of Safe Money

 

Articles and other resources:

Can ‘Skin in the Game’ Pose Conflicts?

A Fund Manager’s Home Cooking

How Green Is BlackRock Fund Manager’s Family Business?

BlackRock to Pay $12 Million Penalty for Failing to Disclose Conflict of Interest

Conflict of Interest? Moi?

What Conflict of Interest? How Power Blinds Us to Our Flaws