A former hedge fund executive faces federal charges for defrauding a UK-based charity over investments in Africa, according to a grand jury indictment made public Wednesday.
Michael Cohen, formerly the head of European operations for Och Ziff Capital Management, was indicted on fraud and conspiracy, among other charges, in the scheme, according to the document, filed in October and unsealed Wednesday by the U.S. District Court in Brooklyn.
Och Ziff is a publicly traded fund company with $33 billion of assets under management in various funds. Africa was once seen as a ripe area of opportunity for the firm, which set up two ventures in 2008 to invest in African mining and oil and mineral interests. That year, the unidentified UK charitable foundation agreed to invest $200 million in one of those investment funds.
Among other charges, Cohen concealed a conflict of interest he had connected with an investment in a mining company, according to the indictment. Some of the shares in that mining company had been sold to the Och Ziff African investing venture by an unnamed co-conspirator who owed Cohen $18 million connected to the purchase of a luxury yacht. This person was going to use proceeds from the sale those shares to partially pay back that personal loan.
Cohen and the unnamed co-conspirator faked and backdated a letter to conceal the scheme, prosecutors said, and Cohen later lied about it to law enforcement.
A lawyer for Cohen wasn’t immediately available to comment. A spokesman for Och Ziff said in an email, “The allegations in the indictment against Michael Cohen do not raise any new issues for the firm, which has settled the matter.”
The case comes after a Securities and Exchange Commission case last year accusing Cohen and another former Och Ziff official of engaging in a widespread bribery scheme to win business in Africa.
Federal investigators have been looking into violations of anti-corruption laws by funds for several years. In Och Ziff’s case the inquiries involved activities in the Democratic Republic of Congo, Libya and other African nations and prompted investors such as public pensions and foundations to pull their investments from the firm.
Cohen was in charge of investing activities in Europe, the Middle East and Africa, the U.S. Attorney’s office said. Och Ziff is run by the billionaire Daniel Och, a former Goldman Sachs trader.
In 2016, the firm agreed to pay more than $200 million to the Justice Department for paying more than $100 million in bribes to win natural resources deals in Africa. It also agreed to pay another nearly $200 million to the SEC. Daniel Och paid $2.2 million in the SEC settlement, though the agency said he wasn’t aware of the bribes.