The short version:
Ex-MIT Professor, Son to Plead Guilty in Hedge Fund Scam
By Christie Smythe Aug 12, 2014 2:59 PM MT
Gabriel Bitran, who was a professor and associate dean at MIT’s Sloan School of Management, and his son, Marco, wooed investors to GMB Capital Management LLC with fake claims of success in managing family and friends’ accounts using a trading model based on the father’s research, according to a copy of a charging document provided by federal prosecutors in Boston.
The Bitrans’ funds suffered losses of more than $140 million. The men paid themselves as much as $16 million in management fees over the life of the businesses and recovered $12 million of their own investments when the funds were doing poorly, the U.S. said, adding that the two discussed their scheme in e-mail exchanges.
Gabriel Bitran, 69, was a professor at MIT from 1978 to 2013, where he focused on research and consulting in the field of “optimal pricing,” according to prosecutors. Marco Bitran, 39, holds a bachelor’s degree from MIT and a master’s degree in business administration from Harvard Business School, prosecutors said.