Hedge Fund Collapse Sparks Global Hunt for Almost $600 Million
It’s not clear who has the missing cash, but it’s definitely not investors in Mars FX
David Choi's hedge fund seemed too good to pass up, with Mars FX US LP posting annual gains that averaged 19% and zero monthly losses. In the end, it was too good to be true.
Choi's fund is now bankrupt, almost $600 million has gone missing, and a global hunt is underway for the money and whom to blame. A criminal fraud inquiry has been opened in the US, and lawsuits are pending in at least three nations, with some alleging forgery and money laundering. The blue-chip auditing firm of Deloitte is being sued after signing off on the fund’s financial statements before its collapse in 2025.
It’s the latest example of investors getting burned in an era when the hedge fund industry and policymakers are pushing for far fewer rules and disclosures. Just this week, US regulators proposed eliminating filing requirements for smaller funds and narrowing disclosures for bigger ones. At the same time, sharp cutbacks in enforcement staff at federal watchdogs could dim prospects for recovering losses.
“Nobody understood the product, to be honest,’’ said Jens Blomeyer, 51, an investor and entrepreneur in Germany who invested $125,000. “We saw the returns, and we got blinded and greedy."
US prosecutors in Manhattan, the Federal Bureau of Investigation and a grand jury have sought information about Mars FX, its sponsor Novus Capital Partners and the circumstances surrounding the fund’s collapse, according to documents reviewed by Bloomberg. The matter also was referred to the Securities and Exchange Commission, the Commodity Futures Trading Commission and civil regulators in the UK and the British Virgin Islands, Novus told investors in emails.
Novus says it’s trying to recover the missing money, casting blame on a tech company Novus says it employed. The tech company in turn claims its platform had stopped operating back in 2022 and never agreed to work with Mars FX.