Former Allianz (ETR
) fund manager Gregoire Tournant pleaded guilty on Friday to investment adviser fraud related to the $7 billion collapse of private investment funds during the pandemic.
Tournant, 57, admitted to the charges in Manhattan federal court and faces up to 10 years in prison at his October 16 sentencing. He agreed to forfeit $17.5 million in ill-gotten gains, including inflated bonuses.
The case involves the March 2020 collapse of Allianz's Structured Alpha funds, which Tournant managed. In May 2022, Allianz paid over $6 billion and its U.S. asset management unit pleaded guilty to securities fraud to settle government probes. Two other former fund managers also pleaded guilty.
Prosecutors said Tournant misled investors about fund risks, altered performance data, and obstructed an SEC investigation by directing a colleague to lie. The funds, once managing over $11 billion, lost about $7 billion as the pandemic triggered market panic in early 2020.
"I knew this conduct was wrongful," Tournant admitted in court. The fraud spanned from 2014 to March 2020, during which Tournant earned more than $60 million.
Previously, Tournant pleaded not guilty to five criminal counts and accused his former law firm, Sullivan & Cromwell, of scapegoating him. The case is U.S. v. Tournant, U.S. District Court, Southern District of New York, No. 22-cr-00276.