London hedge fund sued for late trading

Headstart Advisers Ltd. said today that a lawsuit against it is “utterly misguided,” and the hedge fund plans to fight the charges, Reuters reported. London-based Headstart and its chief investment adviser, Najy N. Nasser, reaped $198 million in illicit profits through improper late trading and deceptive market timing of U.S. mutual funds from 1998 to 2003, according to the suit filed yesterday by the Securities and Exchange Commission in a New York U.S. District Court. Headstart officials today said that the trading actions brought up in the suit have already been reviewed and deemed satisfactory by the United Kingdom’s Financial Services Authority, according to Reuters. The litigation against Headstart comes a week after the SEC filed a suit against another London-based hedge fund, Pentagon Capital Management PLC, and the firm’s chief executive, Lewis Chester, over improper mutual fund trading practices.