Philip Baker, a former hedge fund manager in Chicago, received the maximum sentence for a single wire fraud count. Yesterday, U.S. District Judge John Darrah sentenced Baker to 20 years in prison for fraudulently soliciting $294 million from 900 investors worldwide.
Baker, the managing director of Lake Shore Asset Management, pleaded guilty in August to false claims that its trading in futures contracts was profitable. In reality, the contracts were incurring substantial losses totaling close to $300 million. The scheme led to the collapse of the investment firm.
Because he pleaded guilty, Baker averted a trial. In addition to the sentence, Judge Darrah also ordered Baker to pay nearly $155 in restitution to repay victims.