Gregory J. Blotnick's Rise and Fall as Hedge Fund Manager

Gregory J. Blotnick's Rise as Hedge Fund Manager was marked by impressive returns and a growing reputation in the financial industry. He founded his firm, Blotnick Capital, in 2004.

Blotnick's early success was built on his ability to identify profitable trades and manage risk effectively. His fund's returns were significantly higher than the industry average during this period.

However, his downfall began in 2008, when his fund suffered significant losses due to a series of poor investment decisions. This was partly due to his over-reliance on complex financial instruments.

Blotnick's fund continued to struggle, and by 2010, it had lost nearly 90% of its value.

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Gregory J. Blotnick was sentenced to four years in prison for admitting to lying to get $6.8 million from the Paycheck Protection Program.

In addition to prison time, Blotnick was ordered to pay $4.6 million in restitution.

He submitted 21 phony applications for loans through the Paycheck Protection Program, despite records showing his companies had no employees.

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Blotnick claimed to have as many as 25 workers who were paid a total of $155,000 a month, which was a lie.

He was one of several South Florida residents charged with defrauding the PPP program.

Barry Jay Wolf of Boca Raton was sentenced to 27 months in prison and ordered to repay the nearly $543,000 he got after submitting bogus loan applications.

Oscar Smith, a 42-year-old Royal Palm Beach political consultant, was recently charged with bilking the program out of $212,500.

The Paycheck Protection Program was part of the CARES Act, offering low-interest loans to businesses hard-hit by the pandemic.

The loans were forgiven if the money was used within a certain time period and a sizable percentage was used to pay workers.

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Gregory J. Blotnick graduated from Lehigh University in 2009.

After graduating, he was hired as an analyst at Doubloon Capital, a hedge fund founded by Tom Hudson of Pirate Capital. He later joined Adam Sender’s Exis Capital before pursuing an MBA at Columbia Business School.

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In 2017, Blotnick was hired by Citadel LLC as a Consumer/Retail sector specialist, where he managed over $1 billion in gross market value as part of a five-person team.

He left Citadel in 2019 to found Brattle Street Capital, a New York-based hedge fund manager that focuses on the consumer/retail sector.

Gregory J. Blotnick, a hedge fund manager, was accused of stealing millions of dollars in COVID-19 Paycheck Protection Program (PPP) loans.

He allegedly ripped off $4.6 million from the PPP program by filing multiple fraudulent loan applications for his New York groups, Brattle Street Capital LLC and BSC Management LLC.

Blotnick claimed he needed the funds to cover payroll, but instead transferred the money to a brokerage account and lost millions in the stock market.

Prosecutors argued for a larger bail, claiming Blotnick is a flight risk that tried to leave the country in April.

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Defense lawyers argued the money manager is broke and said he just completed a substance abuse treatment program and is now taking medication for bipolar disorder.

He faces eight-and-a-half to 25 years in prison if convicted.

Blotnick is also facing federal charges of stealing nearly $4 million from the program by falsifying loan applications for three other businesses.

He squandered that ill-gotten cash to buy more than $3 million in losing stock trades, federal prosecutors said.

Blotnick's lawyer said he is expected to plead guilty to the federal charges next week.

He's due back in Manhattan criminal court on October 19.

Blotnick submitted 21 phony applications for loans through the Paycheck Protection Program, federal prosecutors in New Jersey said.

Despite records that showed his various investment companies had no employees, Blotnick claimed he had as many as 25 workers who were paid a total of $155,000 a month.

In addition to prison time, U.S. District Judge Brian Martinotti ordered Blotnick to pay $4.6 million in restitution.

Blotnick is one of several South Florida residents who have been charged with defrauding the PPP program.

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He launched a New York hedge fund in 2019 after he left Citadel Securities.

Blotnick is also accused of misrepresenting payroll expenses at his companies Brattle Street GP LLC and BSC Management LLC in applications for five PPP loans between April and August of 2020.

Based on the allegedly false information, the lenders approved a combined $2.4 million in PPP loan funds for the companies.

Prosecutors allege the loans were never used to pay employees, and Blotnick instead funnelled the majority of the funds into personal trading accounts.