February 4, 2009

Buddhist Patron Neal Greenberg: Agile Group suffers 90% loss, Shambhala International is “potential victim.” [Denver Post]

Update: offices closing.

Update: former clients are suing. Excerpt below, and full story, via/at Denver Post:

The plaintiffs allege Agile inappropriately placed their funds into a high- risk, unsuitable investment called the Agile Safety Variable Fund, which destroyed their retirement nest eggs.

The Safety Fund, despite its name, was a leveraged hedge fund that had invested 85 percent of its money into fraudulent funds run by Thomas Petters and Bernard Madoff, the complaint alleges.

“Agile, like thousands of other investors, was a victim of the Madoff and Petters frauds. We sympathize with the victims who have brought this lawsuit against Agile, but we believe victims should not be suing other victims. Instead, the victims should work together to try to obtain justice from the real wrongdoers.”

…For the rest, go to The Denver Post.

Original report via elephantjournal.com below:

We are sorry to confirm that Neal Greenberg, a longtime student and patron of Chogyam Trungpa Rinpoche and Sakyong Mipham Rinpoche of Shambhala International, has seen his successful, $1 Billion dollar business lose 90% of its assets—in large part due to Madoff and Petters, two of history’s largest Ponzi schemes, according to the Denver Post:

Agile Group, a Boulder wealth-management firm, has frozen client accounts since last fall and warned investors, including former U.S. Rep. Tom Tancredo and KOA talk-show host Mike Rosen, to expect heavy losses.

The firm, run by Neal Greenberg, managed more than $1 billion in mutual funds, hedge funds and private accounts.

“What investors were told is that they are not apt to get any money back until 2010,” said Charles Brega, an attorney with Fairfield and Woods who is preparing to sue the firm.

Brega’s clients, mostly elderly investors who had $3 million with the firm’s mutual funds, were told they could expect a recovery of 5 percent to 10 percent at most.

Agile has failed to provide a detailed explanation about why the money was lost, Brega said. Greenberg did not respond to an interview request.

Clients were told the firm had placed money with Bernard Madoff, accused of swindling investors out of $50 billion in the world’s largest Ponzi scheme, and Tom Petters, a Minneapolis businessman indicted on 20 counts of fraud that could cost investors up to $3.5 billion.

In interviews with Dow Jones on Monday, Rosen and Tancredo talked about Agile’s failure.

“I’ll attribute the blame to Petters and Madoff because they appear to be thieves,” Rosen said. “You can also blame the international market bubble in commodities and everything else. You can blame the financial collapse. . . . You can say that people managing hedge funds, including Neal, bet on some of the wrong horses. . . . But I have no reason to believe that while Petters and Madoff are crooks that Neal Greenberg is too.”

Tancredo said Agile’s problems surfaced in September.

“It started primarily with the collapse of Lehman Brothers,” Tancredo said. “Once it started, it was just like a house of cards.”

Neither disclosed how much money he held with Agile, but a disclosure form Tancredo filed with his 2007 presidential bid listed $530,000 to $1.1 million invested in the Agile Safety Fund, which generated $15,000 to $50,000 a year in income for him.

“I have no idea where it is or what we will be able to recover,” he told Dow Jones, “but it’s pretty serious.”

The firm promoted itself as vigilant at identifying and offsetting investment risks and making money in all market conditions. It was a sponsor of Rosen’s show.

Another potential victim of Agile’s collapse is Shambhala International, which is listed as an under-5-percent owner in the Agile Group, according to documents filed with the Securities and Exchange Commission.

Greenberg taught a course on wealth, meditation and livelihood at the Shambhala Center in Boulder and has close ties to the local Buddhist community, according to the center’s website.

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