US Sues Kahn on Hedge Fund Collapse, Indicts Other Executive

The US Securities and Exchange Commission sued Brian Kahn, the former head of Franchise Group Inc., over the collapse of a hedge fund that he helped run, and federal prosecutors criminally charged another executive in the matter.

The case involves “a multi-year investment adviser fraud” orchestrated by Kahn and other executives that cost investors more than $350 million, according to court papers filed by the SEC on Monday in Trenton, New Jersey. Alina Habba, the acting US attorney in New Jersey, said in a statement that dozens of investors lost $294 million through the fraud.