An employee of the hedge fund run by State Investment Council Chairman Orin Kramer has been charged with stealing more than $1.3 million from the firm, according to a Bloomberg report.

Ezra Levy, a trader at the Kramer-run firm Boston Provident, allegedly transferred $726,000 of the company’s money to his own bank account and generated $600,000 in profit by buying shares of an energy company at inflated prices.

According to a statement released by the firm that is cited in the Bloomberg story, Levy was terminated as soon as Boston Provident learned of the alleged conduct, and the firm contacted the U.S. Attorney’s Office.  Kramer will pay the losses incurred from the alleged crime.

Update, 4:00pm -- below is the full statement on the incident from Boston Provident:

 Boston Provident was outraged to learn of the theft carried out by a former employee, Ezra Levy, from Boston Provident’s limited partners and its general partner.  This is an egregious violation of the law and the trust of our investors.  It is an assault on the core values and principles of Boston Provident and its general partner, Orin Kramer. 

Consistent with his and Boston Provident’s long-standing commitment to the Firm’s clients, Mr. Kramer intends to absorb the considerable professional fees arising from Mr. Levy’s criminal conduct, even though these professional fees are to be paid by the partnership under the partnership agreement.  Mr. Kramer is also providing restitution for the money stolen by Mr. Levy.

Boston Provident terminated Mr. Levy immediately after learning about this outrageous conduct, and Mr. Kramer contacted the U.S. Attorney for the Southern District of New York.  The Firm is continuing to work with the U.S. Attorney and the SEC in an effort to have Mr. Levy prosecuted to the full extent of the law.  Boston Provident intends to seize Mr. Levy’s assets in the partnership and is working with government agencies in seeking to freeze Mr. Levy’s other personal assets.

              Boston Provident has been fortunate to have generated attractive investment returns for its clients over the years, and the restitution will increase previously reported investment returns for the Firm’s limited partners.  Boston Provident’s leadership team has been deeply moved and is profoundly appreciative of the extraordinary support they have received from investors under difficult circumstances and is focused on continuing to deliver attractive returns for Boston Provident’s investors in the years ahead.