SEC charges New York money manager Philip Barry

A New York-based money manager has been charged with running a $40 million Ponzi scheme by the Securities and Exchange Commission (SEC).

Philip Barry of Brooklyn is alleged to have orchestrated the fraud through three of his firms - Leverage Group, North American Financial Services and Leverage Option Management.

The SEC said he promised around 800 investors high returns from the sale of liquid investments, but instead used their money for private interests.

It also alleged that Mr Barry guaranteed returns of as much as 21 per cent per year through the use of a proven trading strategy and misrepresented that the investors' money would be used to trade in options and other securities.

Director of the SEC's regional office in New York George Canellos described him as being "unscrupulous and unregulated", adding that he "lured" his victims with "false promises" of profits and liquidity.

Last month, the regulatory body filed a charge against Las Vegas accountant Michael Moore, who is alleged to have conducted securities fraud by issuing false audit reports.