> By artificially inflating the valuations of their old fund, they can demonstrate high performance to LPs, which may help them raise more capital for the new f

> By artificially inflating the valuations of their old fund, they can demonstrate high performance to LPs, which may help them raise more capital for the new fund. Where is the line between that and a ponzi scheme? How legal the artificial inflation is? Or is it that the valuation that's being artificially inflated isn't a return per se, but rather highly correlated with returns?