08/08/2012 03:42 pm ET Updated Aug 09, 2012

Herman Pretorius, South African Hedge Fund Manager, Shot Partner, Himself Over Alleged Ponzi Scheme


South African hedge fund manager Herman Pretorius allegedly shot and killed his business partner Julian Williams before turning the gun on himself after regulators launched an investigation into his firm, Relative Value Arbitrage Fund, according to Forbes.

Pretorius had come under scrutiny after an article questioned his company's high investor returns as “too consistent," and is now suspected of running a Ponzi scheme worth up to $245 million.

The article in financial news outlet Moneyweb that first called attention to Pretorius' company indicates that there are a variety of reasons to suspect Relative Value Arbitrage Fund of participating in a Ponzi scheme. For one, the company wasn't registered with the Financial Services Board, a regulatory agency that interviewed Pretorius the day of the murder-suicide. That’s to say nothing of Pretorius' expensive lifestyle, one that included an Aston Martin and two houses. One of those houses was featured in a luxury magazine.

Pretorius also reportedly told his pastor that he had a vision in which he hurt a lot of people, according to iol news.

Of course, Pretorius is not the first schemer to meet a tragic end. New York lawyer William Parente killed himself along with his wife and two daughters in 2009 after reportedly running a $20 million-plus Ponzi scheme, according to Bloomberg.

The most famous Ponzi schemer of all time, Bernie Madoff, may not have personally killed anyone in the aftermath of his $65 billion Ponzi scheme, but he and his wife reportedly attempted suicide after the scheme was uncovered.

More recently, PFGBest ex-CEO Russell Wasendorf Sr. attempted suicide after misrepresenting bank statements for years, resulting in the loss of some $200 million worth of investor funds.

CORRECTION: A previous version of this post mistakenly said PFGBest lost $200 worth of client funds. It lost more than $200 million.

Troubled Executives