Bernstein Multi-Strategy Fixed Income Hedge Fund Lawsuit

Sanford C. Bernstein & Co. and Alliance Bernstein L.P. aggressively marketed the Bernstein Multi-Strategy Fixed Income Hedge Fund (MSFI) as being a very safe investment, when in fact it was not.

If you have lost $100,000 or more investing with Bernstein, call 1-800-934-2921 right now to protect your rights.

Have you suffered a loss from investing in the Bernstein Multi-Strategy Fixed Income Hedge Fund?

If you have lost money investing in the Bernstein Multi-Strategy Fixed Income Hedge Fund, you may be entitled to collect compensation.

Our lawfirm is representing investors who suffered a loss from investing in the Bernstein Multi-Strategy Fixed Income Hedge Fund.

The fund was presented to investors as having less volatility and risk than a comparable intermediate bond fund. The MSFI Fund was in fact a very risky hedge fund with excessive risk and volatility. The Fund exceeded its leverage restrictions of 12 times the net asset value of the Fund and was not properly hedged to protect the downside of the Fund’s investments. We are representing investors who have losses in these products and who have large losses in other Bernstein funds.

 

Bernstein Multi-Strategy Fixed Income Hedge Fund: bad product from inception.

According to our law firm's analysis, the Bernstein Multi-Strategy Fixed Income Hedge Fund was a bad product from its inception. Bernstein made blatant misrepresentations regarding the volatility of the Fund. The Fund was sold as an investment with less volatility than intermediate bonds. As a result, investors were led to believe that the Fund was safe, when in fact the Fund's volatility was higher than many other hedge funds. The Fund exceeded the leverage restrictions in the Fund and Bernstein advised investors to stay in the Fund despite internal knowledge that the Fund would likely fail. The Fund was supposed to balance between a Credit Strategy and the High Grade Strategy. The Credit Strategy was the riskier of the two. Due to significant losses from concentrations in sub-prime (individual sub-prime concentrations which violated the Fund's own investment restrictions) the Credit Strategy losses consumed the Fund causing it to completely fail. The Fund was managed by Jeffrey Phlegar, JJ McKoan, and Sean Kelleher. Mr. Kelleher was terminated by Bernstein in late 2007, just prior to the Fund's collapse.

Bernstein also made inappropriate representations to clients that the fund was hedged, and bond-like, when it was anything but safe. Despite representations regarding its overall risk management, and hedging efforts, Bernstein allowed this Fund to spiral out of control with little to no oversight from its compliance department.

Investors could only liquidate their investments every six months. Investors were told to hold in late 2007, but by the time they could redeem in June 2008, most of the Fund had already collapsed.

Invested in Bernstein and Sustain Losses? Contact us to protect your rights.

Complete the form on this page or call Attorney Bill Kyros at 1-800-934-2921 to discuss your rights free of charge.

Kyros Law is a Boston-based law firm with significant experience representing investors in securities arbitration, shareholder class actions, shareholder derivative actions, and securities fraud matters. For info about our law firm please our Kyros Law web site.