A New York federal judge has sentenced Gregoire Tournant, a former portfolio manager for Allianz SE’s U.S. unit, to probation instead of prison, despite allegations he lied to investors about the risk management of funds that lost over $7 billion during the early days of the COVID-19 pandemic.
Chief U.S. District Judge Laura Taylor Swain in Manhattan imposed a three-year probation sentence, with 18 months of home confinement, citing Tournant’s severe neurological illness and her conclusion that his misconduct was not the direct cause of the massive investor losses. Prosecutors had sought a minimum prison term of seven years.
Tournant, 57, pleaded guilty to investment adviser fraud in June and agreed to forfeit $17.5 million and pay a $250,000 fine. The funds at the center of the case, known as Structured Alpha, suffered catastrophic losses in March 2020 as global markets reeled from the pandemic.
Fraud Allegations
Prosecutors accused Tournant and others at Allianz Global Investors (AGI) of misleading institutional investors about the funds’ protections against market crashes and falsifying documents. After the funds collapsed, Tournant allegedly tried to obstruct the U.S. Securities and Exchange Commission’s investigation.
