Amerindo Investment Advisors
| Company type | Private |
|---|---|
| Industry | Investment services |
| Founded | 1985 |
| Founders | Alberto Vilar, Gary A. Tanaka |
| Headquarters | San Francisco, New York City , United States |
Area served | United States, United Kingdom, Panama |
| Products | Amerindo Technology Fund, Guaranteed Fixed Rate Deposit Account (GFRDA) |
Amerindo Investment Advisors Inc. was a prominent investment services company recognized for generating substantial returns during the Dot-com boom of the late 1990s and early 2000s.
The firm was established in the early 1980s by Alberto Vilar and Gary A. Tanaka, initially operating through two separate entities named "Amerindo" located in England and Panama. The U.S. division, known as "Amerindo Investment Advisors Inc.," was launched in 1985.
Its primary East Coast location was situated at 399 Park Avenue in New York City, while the main headquarters and central operations on the West Coast were based at One Embarcadero Center in San Francisco. Additionally, the company maintained an overseas office in London.
Vilar gained early recognition for investing heavily in Yahoo!, which at one stage accounted for 40% of the fund's overall holdings. His investment approach largely involved acquiring shares soon after companies completed their initial public offerings.
The firm's leading offering, the "Amerindo Technology Fund," concentrated on funding startup ventures within the high tech and Dot-com company sectors. Despite experiencing rapid expansion throughout the internet surge, this fund ultimately failed.
Vilar attracted media spotlight by declaring that the internet represented a transformation "bigger than the Industrial Revolution."
Fraudulent activities
Amerindo marketed its "Guaranteed Fixed Rate Deposit Account" (GFRDA) as being invested in "high quality, short-term deposits" with a "fixed-rate of interest for a fixed-term." Contrary to these claims, the funds were redirected into high-risk dot-com projects, leading to major losses following the 2000 dot-com crash and leaving Amerindo unable to reimburse investors, resulting in millions lost.
Investor Lily Cates contributed $5 million to the "Amerindo Small Business Investment Company," only to have most of her capital diverted toward covering Amerindo's operational costs, charitable commitments made by Vilar beyond his financial capacity, and settling a dispute with a former client over the GFRDA account. In 2003, Vilar directed an employee to forge Cates' signature to authorize a $250,000 transfer, which primarily ended up in Vilar’s personal account. Cates lodged a complaint with the U.S. Securities and Exchange Commission (SEC) in 2005. Throughout the investigation, Vilar provided false testimony denying that Cates was a client and disavowing ownership of Amerindo’s Panamanian subsidiary.
In 2005, founders Vilar and Tanaka were convicted for executing schemes that defrauded their clients. Following a nine-week trial, Vilar was found guilty on numerous charges including securities fraud, wire fraud, money laundering, investment advisor fraud, mail fraud, making false statements, and conspiracy. Tanaka was convicted on three counts: securities fraud, investment adviser fraud, and conspiracy related to securities fraud and money laundering.