While the impacts from the alleged financial fraud perpetrated by Sean and Shane Hvizdzak are still coming to light, the brothers have entered into a consent order with the Securities and Exchange Commission, giving them more time to respond to the allegations.
Sean and Shane Hvizdzak are accused of bilking clients of their cryptocurrency hedge fund out of millions of dollars, diverting the money for their personal use rather than investing it, the SEC alleged.
Shane Hvizdzak, 32, of Bradford, who has taught at both University of Pittsburgh at Bradford and St. Bonaventure University, and Sean Hvizdzak, 34, of St. Marys, a local attorney whose clients include the City of Bradford Board of Health, were both named in the SEC complaint, temporary restraining order and asset freeze, which were publicly released last week.
Earlier this week, a client of the law firm of Lang & Hvizdzak contacted The Era about his house sale in which the firm was assisting. The client said the law firm’s accounts had been frozen by the SEC, leaving his house sale in limbo.
On Friday, Daniel Lang, law partner of Sean Hvizdzak, confirmed it to The Era.
“Unfortunately, the SEC froze our firm bank accounts because they also had Sean’s name on them,” Lang explained. There were a few transactions in progress when this occurred.
“We had contacted people to let them know the funds are frozen and we are working with the SEC to get them unfrozen,” Lang said.
He stressed that none of the firm’s funds were involved in any of the alleged fraudulent activities of which Sean Hvizdzak is accused.
“We are aware of the issues and I am very sorry for them,” Lang said. “We are trying to get it rectified as soon as we can.”
He is in the process of opening new accounts for the law firm, and hopes to be able to get the finances straightened out quickly. And he noted that he is continuing to operate.
“Other than those few clients who had transactions in progress, we hope that nobody else will be impacted,” Lang said.
In the consent order is a list of 27 accounts that had been frozen, including accounts for Lang & Hvizdzak, BH Adventures LLC, 561HS LLC, High Street Capital Fund USA, High Street Capital Partners, High Street Capital, Hvizdzak Capital Management and personal accounts.
The consent order indicated the Hvizdzaks have 30 days from Friday in which to provide a verified written accounting of any accounts, assets or funds valued at more than $5,000 currently held by them, any assets or funds valued at more than $5,000 that were transferred to anyone since Jan. 1, 2017, and a list of investors or limited partners in any investment vehicle owned or controlled by the brothers.
The brothers also agreed to preserve any records and to bring back to the U.S. any and all assets obtained by the alleged fraudulent activity within 30 days, according to the court order.
A preliminary list of accounts, assets and investors is to be provided within five days, the order noted.
The order also noted that the Hvizdzaks consenting to the order does not imply any admission of guilt on their part.
David Berardinelli, the Pittsburgh attorney for Sean Hvizdzak, had no comment on the pending litigation when contacted by The Era on Friday.
Efrem Grail, also of Pittsburgh and the attorney for Shane Hvizdzak and High Street Capital, did not return a message seeking comment.
