Investors who say they are having trouble getting their money back from a firm that appears to operate at different times in several countries may find their complaints falling into jurisdictional cracks.

Or, that’s what appears to be happening to some who trusted their money to SP Trader.

The investor stories have a consistent theme. Some investors claim they got excuse after excuse when they sought to redeem their money. Others say they got some of their money back, but then were put off when they wanted to take more out.

Investors who talked to HedgeFund.net said they put in close to $1 million in total in the fund.

When investor David Downey decided in May 2008 that he wanted to do other things with the $110,000 he invested, he says he received several e-mails from his SP Trader contact, Ben Weiss. Each time, he claims that Weiss gave him a date by which he could expect his money, but he tells HFN that he still has not received his money.

Another investor, Victor Liu, a retired chemist, says he gave SP Trader about $125,000 in 2006 and 2007. Like Downey, he asserts that he traded e-mails with Weiss for several months after he sent in his redemption notice.

In his last exchange with Weiss, Liu says he wrote, “I hope it’s not that you are a mini-Madoff.”

At first, Jim Douglass, an electrical engineer who says he put close to $250,000 in the fund in 2007, got some of his money back when he asked for it.

But in June 2008, when he tried to redeem the full amount that showed up on his monthly statement -- $190,000 -- he says the money was not forthcoming.

Douglass, however, reports that he received a number of reasons why he wasn’t getting his money, including that the firm had switched auditors to Ernst & Young. He says he had his Charles Schwab broker, Robert Pace, contact Mark Roberts, one of the firm’s listed principals. Pace, however was allegedly unable to verify the information about the auditor and Schwab re-set Douglass’ account to zero.

When Douglass and his wife June kept getting put off, they began their own investigation. They claim that they discovered the bank account at RBS Coutts in Switzerland to which he had wired the money was frozen because of an Austrian court’s investigation into the fund.

Douglass says he’s afraid he may have lost all his savings.

Jim and June Douglass along with Downey are now heading up an informal investor group that is trying to bring their concerns to the appropriate authorities.

Weiss sent an e-mail to HFN on Oct. 29, in response to a request for him or Roberts to talk about the investor complaints.

“I believe that most investors have been getting their redemptions and that this issue is being resolved. Some investors were incorrect about their redemption dates based on the [sic] their redemption notices and that appeared to be the major problem. Out of some six hundred investors there were about 10 investor complaints. We would like to reduce that number to 0,” Weiss wrote.

That was what Liu says happened when he first sent in his redemption notice to SP Trader in December 2008.

After a couple of weeks, Liu says, Weiss told him there was a six-month waiting period. On Jan. 12, Liu says, Weiss gave him a date when he could expect his money: June 27.

As of Sept. 14, the last time HFN was in touch with Liu, he had still not received his money.

Although Weiss claimed the issue with redemptions was due to a misunderstanding, he did not respond to a follow-up e-mail from HFN with questions including the total assets under management of the funds, their liquidity, the name of the funds’ administrator and auditor and SP Trader’s business address and phone number.

What is SP Trader?

SP Trader says on its Web site that one of its funds has been in existence since 2000, and that the other was started up in 2003. According to information available on that Web site, neither fund reports a down year. Its founder is said to be Mark Roberts, who now would be in his early 50s.

SP Trader’s strategy according to Downey is “S&P futures, hedged with options and futures,” a strategy that should be highly liquid.

After reviewing the returns posted on SP Trader’s Web site, Stephen Brown, a professor of finance at New York University Stern School of Business wrote in an e-mail to HFN, “This fund is reporting quite extraordinary returns in the context of a very difficult market environment.”

Brown cautions that he knows nothing about the fund, other than what he saw on the Web site and that, “one could never prove that these reported returns are fraudulent.”

However, subjecting the fund’s reported monthly returns for the frequency of the last digit, a common test for possible fraud, reveals some interesting anomalies, Brown says. He points out that, statistically, there should be a normal distribution of odd and even digits at the end of each reported return, but there are only 25 odd numbers reported to 91 even numbers.

“There is only one chance out of 3,764,108,425 that you would find 25 or fewer odd numbers among the 116 return numbers reported,” Brown writes. “To put this in perspective you are 83 times more likely to win the New York Lotto Extra.”

Where is SP Trader?

One of the problems the informal investor group claims it is encountering is trying to figure out where, really, SP Trader is located.

The firm has a Web site. A London address the firm gave in the past is for a “virtual office,” where companies can rent an address without actually setting up shop. That office is now closed.

The firm’s Web site also used to claim that it had a Swiss office, but that is no longer the case. FINMA, the Swiss regulatory agency, has a warning about SP Trader on its Web site that the firm is unregistered.

On July 13, 2009, the Financial Services Commission of the British Virgin Islands, where SP Trader claimed to be incorporated, issued a warning that the firm was not licensed to carry on a financial services business in or from the territory.

Answering a phone number in Switzerland that was listed in an earlier version of SP Trader’s Web site, Guy Brooke, who works for Forex trader White Knight Partners, told HFN that SP Trader was “out of business.”

Brooke says White Knight gets about 10 calls a week about SP Trader from the U.S. and from Europe.

“People said they lost millions,” Brooke says.

Millions didn’t seem to be what the FBI’s San Jose, Calif. office thought when it decided to forego a domestic investigation after investors complained.

FBI spokesman Joseph Schadler says the investigation has been referred to the Austrian court that is investigating the firm.

“The bad guy is in Switzerland,” Schadler says. “There are a couple of victims here, but they are all over the world. We don’t touch things under $1 million.”

Investors said they recently made complaints to the Securities and Exchange Commission. John Heine, a spokesman for the SEC, says the agency does not confirm or deny investigations.

Nancy Grunberg, an attorney with the law firm Venable LLP who formerly was with the office of international affairs at the SEC, says investigations are more complicated when they cross several countries’ borders, but that the SEC works well with foreign authorities.

The larger problem arises, Grunberg says, when investors try to collect assets that are overseas if they win their case.

“It’s procedurally complicated to go through the foreign court,” she says.

Maria Auckenthaler, the Austrian prosecutor who is handling the SP Trader case, had only recently been assigned to the case when HFN first contacted her in mid-July, so she said she needed time to look into it. In October, Auckenthaler e-mailed that she still had no information about the progress of the case.

But she did add one interesting tidbit.

“It is correct, that the austrian [sic] authorities believe that ‘Mark Roberts’ is an alias,” Auckenthaler wrote in response to a question.

Weiss said, in an e-mail, that Roberts was no longer with the firm and, therefore, he could not comment about Auckenthaler’s assertion.

He also wrote, “In our opinion, the investigation will be dropped as the facts around the firm and not around Mr. Roberts come to the foreground.”

Neither Weiss nor anyone else at SP Trader responded to e-mailed questions from HFN about the status of SP Trader's offices in different countries or about regulatory warnings or investigations in Austria, Switzerland, or the British Virgin Islands.

Whether or not Roberts and Weiss are who they say they are, apparently, Weiss is still writing to investors.

In September, Downey says he received an e-mail from Weiss. Downey claims that Weiss wrote that SP Trader was in the process of selling itself to a Swiss firm. He also said Roberts was on leave because he had withheld information from directors and shareholders that caused problems with the banks.

Then, Downey says, Weiss went on to say that some investors had “run to the banks,” when they couldn’t get their money back in the short term, an action that “has been detrimental to everyone, particularly the investors themselves.”

This summer a “Help Wanted” ad appeared on aftercollege.com, an online job board, for a quant finance and coding intern with SP Trader Fund.

“Initially work from home, company will have an office in NY within six months,” the ad read.

The ad was signed by Ben Weiss and gave a zip code located in New York City.