Dive Brief:
- The former CFO of a Miami hedge fund is facing jail time after pleading guilty to a years-long embezzlement scheme, the Department of Justice said Tuesday.
- Theodore Woo, 49, of Miami, admitted to using his position to steal more than $3 million from his employer through falsified invoices, unauthorized cash transfers and personal expenses charged to company credit cards, according to the DOJ. He is scheduled to be sentenced Nov. 18 by U.S. District Judge Lewis A. Kaplan of the Southern District of New York for one count of securities fraud and faces a up to 20 years in prison.
- The “charge and plea are indicative of this Office’s commitment to holding C-suite executives accountable when they engage in fraud,” U.S. Attorney for the Southern District of New York Jamie McDonald said in a statement.
Dive Insight:
The unnamed hedge fund is a Miami-based registered investment adviser that manages over $100 million in discretionary assets through pooled investment vehicles and related private funds, according to the indictment.
Woo began embezzling money from the fund shortly after he started working for it and continued the scheme until his termination in March 2026, the government alleged.
As CFO, he handled back-office tasks for the fund and had the authority to authorize the fund’s administrator to process reimbursement requests. In that capacity, Woo instructed the fund administrator to make millions of dollars in payments to two entities, TWDRR LLC and MGTW LLC, for claimed “research consulting services,” according to prosecutors.
Woo also allegedly sent invoices from those two entities that falsely represented that they had rendered services for the fund. In reality, he controlled both entities, and neither entity had performed any service for the fund.
Woo also allegedly misled the fund's external auditor to conceal the arrangement, claiming that MGTW was an independent research consulting firm hired to develop short investment ideas on a project-by-project basis.
The government said Woo opened and controlled multiple credit cards in the fund's name and charged unauthorized personal expenses to them, including thousands of dollars in purchases at adult entertainment establishments and on international vacations.
“For years, Theodore Woo flagrantly abused his position of trust and brazenly stole from his employer to line his own pockets,” McDonald said.
Woo could not immediately be reached for comment.
