Could it be a fraud?

The strong returns for the Flex Fund in 2017 and since its inception 8 years ago make it one of the best performing hedge funds in the world. It naturally raises the question as to whether this could be some sort of fraud. It’s a good question for all investors to ask and the answer, of course, is no…there is no fraud. I’m obviously going to give this answer, especially if I were attempting to commit a fraud, but here is a reminder of the safeguards in place and how you can be confident in my answer.

Service Providers – their roles and protections provided

The Fund has multiple service providers that, among other things, each help protect you in different ways from the risk of fraud. Here are those service providers and generally how they help provide protection.

Money Movement

The risk of fraud is highest when money is motion. As mentioned above and as every investor has experience, every investment into the Flex Fund goes directly to BMO Harris Bank per the instructions in the Fund Subscription Booklet. Once the money is at BMO, it is being monitored by NAV Consulting and cannot be moved without their permission.

When an investor makes a withdrawal from the Fund, documentation must be provided to NAV Consulting. Money to satisfy any withdrawal is first moved from the Fund’s investment account at Interactive Brokers to the Fund’s bank account at BMO Harris. Once NAV verifies the investor’s withdrawal request, NAV makes the request for the wire to the investors. Only NAV can make these requests which are then only approved by Patton. Again, this process prevents Patton from being able to fraudulently move money from the Fund.

Conclusion

There are multiple safeguards in place via the multiple service providers to protect investors in our Fund from fraud. Our goal is to provide the greatest protection, utilize world-class service providers to do so, and to be as transparent as possible about the Fund’s operations. Your confidence in the safety and security of your investment in the Flex Fund is extremely important to me. Please let me know anytime you have questions or feel free to reach out directly to our service providers for confirmation from them.

Returns – too good to be true?

On the topic of the Fund’s returns and any question about whether or not they may be too good to be true, I’ll address this in a later blog. Returns have been strong and I believe long-term returns will continue to be strong but there is nothing too good to be true!

Thanks!

I appreciate the trust and confidence every investor has placed in me and my company to be of service.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. Any specific securities or investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own situation before making any investment decision including whether to retain an investment adviser.

All expressions of opinion are subject to change without notice in reaction to shifting market, economic or political conditions.  Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. This content was created as of the specific date indicated and reflects the author’s views as of that date. Supporting documentation for any claims or statistical information is available upon request.

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