business

Ex-Apollo Partner Who Made Millions Allegedly Expensed Haircuts

  • SEC says Ali Rashid charged clients for vacations, spa trips
  • Private equity firm settled a related SEC case in August 2016

A former senior partner at Apollo Global Management LLC who made millions of dollars a year was sued by U.S. regulators for allegedly charging the firm’s clients for personal expenses, including vacations in Hawaii and Brazil, and frequent trips to the hair salon.

Ali Rashid, 41, was accused of misappropriating $290,000 from January 2010 to June 2013, according to a complaint filed Wednesday by the U.S. Securities and Exchange Commission. Rashid falsified his expense reports so that investors in Apollo private-equity funds ended up paying for him to attend friends’ weddings and to get his hair cut, the SEC said.

“Mr. Rashid strongly disputes the SEC’s stale and spurious claims,” his lawyer, William Burck, said in an emailed statement. “He very much looks forward to full vindication in court.”

Rashid’s illicit charges included $3,500 to buy a suit for his father that he marked in his expense reports as being holiday gifts for executives, the SEC said. In 2010, he listed $1,100 in hair salon visits as “meals with management,” according to the regulator. The agency is seeking a monetary penalty from Rashid, who left Apollo in 2014.

Apollo Settlement

Apollo settled a related case for failing to supervise him in August 2016 without admitting or denying the regulator’s findings.

After a secretary became suspicious of his expense reports in 2010, an Apollo manager reviewed Rashid’s receipts and found prohibited transactions. Rashid admitted he improperly charged personal expenses, and reimbursed Apollo, which reprimanded him for his conduct, according to the August 2016 complaint.

Two years later, Apollo again discovered that Rashid was charging personal expenses to the firm’s clients. The New York-based firm then hired an outside firm to conduct a company-wide review of expense allocations and found even more personal expenses that Rashid didn’t pay, according to the SEC.

“The SEC’s lawsuit, filed earlier today, is based on misconduct that Apollo discovered, stopped and promptly reported to the SEC more than four years ago and which was publicly disclosed more than a year ago," a company spokesperson said in an emailed statement Wednesday.

The firm said it ensured that affected funds and companies were reimbursed, adding that it "has continued to enhance its internal policies and procedures with respect to employee expenses and has cooperated fully with the SEC throughout this investigation."

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