A hedge-fund manager has been arrested and charged with fraud in connection to Neiman Marcus’ bankruptcy.
Dan Kamensky, the founder of Marble Ridge Capital LP, has been charged by New York prosecutors with securities fraud, wire fraud, extortion and obstruction of justice, according to the Wall Street Journal. Neiman filed for bankruptcy in May, and announced in July that it would permanently shutter its flagship store in Hudson Yards.
Kamensky’s tensions with the high-end department store chain date back to at least 2018, when he led a legal campaign against the shop’s private equity owners.
But after Neiman filed for bankruptcy this spring, Marble Ridge offered 20 cents on the dollar to buy shares of MyTheresa, the retailer’s ecommerce business, from creditors. When Kamensky learned that a Jefferies client was considering buying the shares at a higher price, he allegedly attempted to use his influence with the bank to kill the deal.
If convicted, Kamensky could face up to 50 years in prison. Neiman has also sued his hedge fund, Marble Ridge, for more than $60 million in damages.
Department stores including Neiman Marcus have been hit hard by the pandemic, and a number of others have gone insolvent in recent months. Neiman’s bankruptcy in particular marked a big loss for Related Companies and Oxford Properties Group, which covered the costs of a pricey buildout for the retailer to anchor its Hudson Yards mall in New York. Now, the developer has been reportedly shopping the 190,000-square-foot space as office.
[WSJ] — Sasha Jones