New York (HedgeCo.Net) – The SEC, in a parallel civil claim, has barred hedge fund managers Anthony Chiasson and Todd Newman from associating with investment advisers, broker-dealers and other entities registered with the SEC.
In the original criminal case, Level Global’s Chiasson was found guilty of insider trading charges and sentenced to six and a half years in prison, Diamondback’s Newman was sentenced to four years and six months.
Manhattan-based Chiasson is a co-founder of Greenwich, Conn.-based Level Global Investors. The government said he earned about $50 million illegally by trading on a tip received about Dell Inc. stock in 2008. He was also was ordered to pay $5 million in fines and to forfeit illegally obtained proceeds of as much as $2 million.
The hedge fund executives are among dozens ensnared in the government’s recent insider trading crackdown. Unlike most defendants, though, Chiasson and Newman did not strike plea agreements and brought their case to trial, only to be convicted on all counts they faced related to trades ahead of earnings reports that Dell and Nvidia released in 2008 and 2009.
Chiasson and Newman were accused by prosecutors of taking part in a “criminal club” of finance professionals that used their connections to trade illegally. Also charged by criminal authorities and sued by the SEC were Jesse Tortora, an analyst for Newman; Spyridon “Sam” Adondakis, an analyst for Chiasson; Danny Kuo, a vice president and fund manager at Whittier Trust Co.; Jon Horvath, a technology analyst at Sigma Capital Management; and Sandeep “Sandy” Goyal of mutual fund company Neuberger Berman Group LLC. All of those individuals have pled guilty and settled the SEC’s claims.
Level Global and Diamondback were also sued by the SEC. The firms settled for $21.5 million and $9 million, respectively.
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