Collapse of
Kauai resident’s
gold fund probed
Securities officials are examining
By Russ Lynch
Troubador Inc. after investors
allegedly lost all of
their money
Star-BulletinState and federal securities officials are investigating the collapse of a Kauai resident's gold-investing fund that allegedly caused investors across the nation to lose their entire investment.
More than 30 investors put cash into the fund, which was started in late 1995 by Troubadour Inc. to invest primarily in gold futures. The fund collapsed earlier this month, after a plunge in gold prices, leaving the investors penniless, according to an article in today's Wall Street Journal.
Officials of the state securities enforcement unit, part of the Department of Commerce and Consumer Affairs, said an investigator has been assigned to look into the matter.
The Wall Street Journal said federal investigators are also interested and quoted the Securities & Exchange Commission and the Commodity Futures Trading Commission as saying they have little information on Troubadour.
Troubadour's chairman, David T. Marantette III, was not available for comment, according to a woman who answered the telephone at his Princeville home this morning. His attorney, Brook Hart in Honolulu, also could not be reached.
Hart told the Journal that less than $1 million was involved.
Marantette managed the Troubadour fund from his home, where his prime business is the Goldstock Letter, an Internet newsletter that describes itself as aimed at investors and traders in silver, options on gold stocks, and gold and silver futures.
In statements on the his Internet site, www.goldstock.com, Marantette says his first fund, the Goldstock Trading Portfolio, has made an average return of 20.86 percent and that anyone who invested $100,000 when it started 19 years ago would now have more than $11 million in the fund. Marantette's statements warn that there is risk and he says about 40 percent of his trades lose money.
The Journal commodities column today says Marantette started the Troubadour fund a few years ago as a limited partnership. Hawaii government records show it was first registered as a business in October 1995, with Marantette's company, Troubadour Inc., as the general partner and 34 limited partners.
Troubadour Inc. was registered as a company in Hawaii in 1991 as a "market letter writer and cyclic research" business.
