Alleged scammer suit delayed

A federal judge postponed the Pitt and Carnegie Mellon University lawsuit against two… A federal judge postponed the Pitt and Carnegie Mellon University lawsuit against two individuals accused of misappropriating hundreds of millions of dollars. The universities entered civil complaints against Westridge Capital Management Inc., an investment firm in Santa Barbara, Calif., and its principals, Paul Greenwood, 61, and Stephen Walsh, 64, on Feb. 20, charging a combined $114 million in investment fraud between the two schools.’ U.S. District Judge Terrence F. McVerry of the Western district of Pennsylvania delayed the case on Friday until the Southern District of New York could hear similar criminal suits against Greenwood and Walsh filed by the Securities and Exchange Commission and the Commodity Futures Trading Commission. The hold comes at the request of the universities, which filed a joint motion asking to stay the case. ‘We view the ongoing proceedings initiated by the [trading commission], [exchange commission] and the U.S. attorney for the Southern District of New York to be beneficial and supportive of our ultimate goal in this matter,’ wrote John Harvith, senior associate vice chancellor of public affairs, in a recent University statement. ‘Accordingly, it is in our best interests to temporarily stay our own proceedings while vigilantly monitoring and cooperating in the New York litigation,’ the statement said. Mark Hall, law clerk for Judge McVerry, said that it is unclear when the court will hear Pitt and CMU’s case, or how much money the universities will recover. Hall declined to comment further on the case. David Rosenfeld, associate director of the exchange commission’s New York office, said that Greenwood and Walsh are scheduled to appear at a hearing on Tuesday in Manhattan, during which the court will file a preliminary injunction against the defendants. He said that the exchange commission has already frozen Westridge’s assets, secured a temporary restraining order against Greenwood and Walsh and appointed a receiver ‘mdash; or interim manager ‘mdash; for the company. Greenwood and Walsh, both of New York, are co-owners of Westridge and partners in two other companies ‘mdash; WG Trading Investors, L.P., an investment vehicle, and WG Trading Company, a registered broker dealer. The exchange commission lawsuit accused the pair of committing investment fraud beginning as early as 1996. Greenwood and Walsh allegedly used investors’ money ‘as their personal piggy-bank to furnish lavish and luxurious lifestyles,’ according to the lawsuit, purchasing cars, horses, rare books, teddy bears and multi-million dollar homes, among other expensive items.