Cheese Heir Gets Estate Back From Young Hedge Funder

by Deidre Woollard (RSS feed)
Sep 2nd 2009 at 7:01PM

Another tale of hedge fund woe has led to a quickie auction. WGRZ in Buffalo, New York tells the story of the most expensive estate in Erie County which recently went up for auction and ended up back in the hands of its original owner. Last year 22-year-old Michael Wilson, said to be a hedge funder from Cleveland, bought a huge estate on Boston State Road in Hamburg from John Russo, one of the heirs to the Sorrento Cheese company. He paid more than six million dollars, putting down two million dollars and arranging for a mortgage of more than four million dollars with Russo.

In May, Wilson was supposed to make a one million dollar payment on the mortgage but didn't. Russo started foreclosure proceedings. In July, FBI agents seized Wilson's computers, records and documents. Wilson hasn't been charged with a crime yet but it's believed that he may have taken money from investors to make that $2 million down payment on the estate. The estate, which is actually two separate homes of around 15,000 square feet each, was auctioned off and no one else bid so the homes reverted to Russo who got to keep the $2 million. The two homes will eventually be put back on the market.

Tags: buffalo, hedge funds, HedgeFunds, sorrento