The Securities and Exchange Commission (SEC) has charged a Marin hedge fund manager for fraud for his alleged participation in an investment scam involving over $12 million. Larry Goldfarb has entered into an agreement with the U.S. Attorney and has admitted to one count of wire fraud.It has also been reported that Mr. Goldfarb, who runs BayStar Capital Management, admitted to transferring about $12 million of investors’ funds to two of his entities and used funds to invest in Marin real estate. He also allegedly used some of the funds for an investment in a San Francisco record company and to make several charitable contributions. The U.S. Attorney’s office has agreed not to bring charges against Mr. Goldfarb, if he agrees to pay $12.1 million in restitution to BayStar investors, as well as agrees to a three-year ban from the investment industry. The SEC has accused the 52-year-old Mr. Goldfarb of San Anselmo, of misusing funds since at least 2006 to invest in what they describe as highly profitable “side-pocket” investments. The SEC also says that Mr. Goldfarb deposited the side-pocket proceeds "into the bank account of one his related entities, which he used to pay for unauthorized personal expenses including entertainment and charitable donations."Mr. Goldfarb was able to settle with the SEC without having to admit or deny guilt.