The co-founder of Premium Point Investments and a former trader pleaded guilty to charges they overstated asset values at the now-defunct hedge fund, but they won’t serve any time behind bars.

Anilesh Ahuja, the fund’s co-founder, and trader Jeremy Shor were found guilty of conspiring to overvalue the hedge fund’s assets by more than $100 million and sentenced to prison in 2019, but U.S. District Judge Katherine Polk Failla in Manhattan overturned their convictions in December due to errors and misleading statements by prosecutors.

The pair had faced a new trial but reached a deal with the government allowing them to plead guilty to a single securities fraud count. Under the deal, which was approved by Failla in a hearing on Friday, the two men won’t serve any prison time, pay a fine or serve probation.

Before their convictions were overturned, Ahuja was sentenced to more than four years in prison and Shor, almost 3 1/2. But their surrender dates were delayed, initially because of the emerging Covid pandemic and later because the judge was considering throwing out the verdict. As a result, neither man served any part of his sentence.

“We are pleased that Mr. Ahuja can finally put this ordeal behind him without having to spend a day in jail,” his lawyers, Richard Tarlowe and Roberto Finzi, said in a statement.

“After years of litigation, we are pleased to put this matter behind us with no additional punishment beyond the punishment already inflicted by the process,” Shor’s lawyer, Justin Weddle, said in an email.

Federal prosecutor Daniel Gitner defended the deal before the judge on Friday, saying Ahuja and Shor had already made “substantial restitution” to investors.

“The resolution should send a message that we stand behind the prosecution,” said Gitner, head of the criminal division in the Manhattan U.S. attorney’s office.

Prosecutors said Ahuja and Amin Majidi, a Premium Point portfolio manager who pleaded guilty and testified against his former colleagues, set inflated monthly targets for returns, then ordered Shor and other traders to manipulate the valuations accordingly. Their goal was to make the firm’s performance seem better than it was so they could charge investors higher fees and keep them from withdrawing their money.

A jury found both Ahuja, 54, and Shor, 50, guilty of four criminal counts in July 2019, but their lawyers uncovered documents they said showed that a sworn statement by Majidi at the time of his guilty plea was virtually identical to one drafted by prosecutors. That showed Majidi was willing to say whatever the government wanted, the defense lawyers argued.

The judge’s decision to throw out the original verdict was a setback for federal prosecutors in Manhattan, who have seen other cases collapse over their failure to share evidence.

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