I agree. This also sets an important precedent that future investors in different funds must consider. If something seems too good to be true, there might be consequences for them. They are disincentivized to look the other way.
Not really since they still get to keep all the profit they made off the stolen goods.
That's exactly what's not happening in this case.
Actually, I think it is. It sounds like they're clawing back the investment profit, but it is likely those profits were invested in something else which also earned a profit. That additional profit is yours to keep as far as I can tell.
So they get to keep the profit they made off the profit but but not the profit itself?
Alternatively, they could have spent the original profit or lost it on another investment... In other words the end result was similar to a loan. I'm curious whether the claw-back included a risk-free interest rate.