Jefferies Fraud Suit Against Ex-Fund Manager Tossed by Judge (1)

A Jefferies Financial Group Inc. hedge fund’s lawsuit claiming it was defrauded by a former portfolio manager who invested $100 million of its money in a Ponzi-like scheme was dismissed by a federal judge.

The fund, 352 Capital, inappropriately sued Jordan Chirico under a federal racketeering statute that doesn’t allow for the fraud claims it brought, US District Judge Valerie Caproni ruled Tuesday in Manhattan. She said that the remaining claims in the case by 352, which is part of Jefferies’ Leucadia Asset Management arm, belonged in state court.

In a statement, a Jefferies spokesperson pointed out that Caproni had ...