Reuters – A former hedge fund manager, who pleaded guilty to criminal insider trading charges stemming from Citizens Financial Group Inc’s $10.5 billion acquisition of Charter One Financial Inc has settled his civil case with the U.S. Securities and Exchange Commission, the agency said on Monday.
The manager, Michael Tom of Waltham, Massachusetts, agreed to pay $150,000 in penalties and roughly $650,000 in disgorgement to settle charges that he earned $743,505 of illegal profits, the SEC said in an advance copy of the statement.
Tom neither admitted nor denied guilt, his lawyer, Mark Pearlstein, said.
Tom once worked at Citizens examining banks that the company, a unit of Royal Bank of Scotland Plc, wanted to acquire. He then established Global Time Capital Management LLC, the Burlington, Massachusetts-based general partner of GTC Growth Fund LP hedge fund, regulators and prosecutors said in court documents.
According to those documents, after getting a tip from a former colleague who told him that Citizens was conducting due diligence on a Cleveland-based bank that Citizens was about to buy, Tom bought securities for his fund, his relatives and himself in each of three banks, including Charter One, that he believed might be acquired.
