Anthony Chiasson, the co-founder of the hedge fund Level Global Investors, was sentenced to 6.5 years in prison today for illegal trading in two tech stocks…Throughout the hearing, Chiasson sat surrounded by his lawyers, chewing gum furiously. “What I keep coming back to is this crime, these crimes, were committed over a long period of time, over a time when you were already fabulously wealthy,” said Judge Sullivan. “I don’t know if I’ve ever sentenced someone as wealthy as you.” He added: “It’s hard to understand why someone would risk something like that.” Chiasson’s lawyers, meanwhile, reviewed the many good deeds their client had done in life, his role as a family man with two small children and the fact that he was an altar boy when he was 8 years old. When it came time for Judge Sullivan to deliver the verdict, Chiasson, 39, stood up and shoved his hands deep into his pockets, his jaw chomping away the whole time. After informing Chiasson that he would be spending 78 months in prison, Sullivan said: “You conducted yourself with dignity—except for chewing gum.” [BusinessWeek]
Level Global
Convicted Insider Traders Probably Regretting Association With Group Calling Itself “Fight Club”
By Matt LevineIt gives me no particular pleasure to update the ol’ insider trading sentencing chart every time a new person is convicted of insider trading, but I view it as a public service for the less instinctually law-abiding among our readers and here we are:
After three days of deliberations, a jury convicted Anthony Chiasson, a co-founder of Level Global Investors, and Todd Newman, a former portfolio manager at Diamondback Capital Management. The two had denied charges that they participated in a conspiracy that made more than $70 million illegally trading technology stocks.
Anyway chart (background here):
As, like, half of Manhattan gets convicted of insider trading, this chart has gotten a bit raggedy; various forms of cooperation or sympathy or silliness of the sentencing guidelines will move you off the predicted lines. Read more »
-
Posted in:
insider-trading
Today’s Insider Trading Arrests Brought To You In Part By A Cooperating Witness Whose Name Starts With The Word “Spy”
By Bess Levin
Remember, about a year ago, when hedge fund Level Global was rumored to have a government mole in its ranks? At the time, the firm’s representatives said such reports were total bull shit, and, investors were told, here’s how they knew that to be the case:
“As is the case each time there is a new development in the U.S. Attorney’s investigation, we have conducted an extensive internal factual correlation analysis, cross-referencing the facts in the complaints to our firm’s records. Our experienced outside legal counsel has also conducted its own analysis. Based on all of our work and analysis, we have concluded that these complaints do not appear to be referencing Level or Level personnel.”
Frankly, LG was getting a little tired of having to constantly run factual correlation analysis in order to prove the world wrong but c’est la vie. Anyway, despite usually having a 99.9% accuracy rate, the factual correlation calculator apparently missed one.
Last month, federal prosecutors in Manhattan said in a court filing in the case of a PGR employee that Level Global had made a $1.7 million profit by covering a short position it had in Taiwan Semiconductor Manufacturing Co. Ltd. in June 2009. That May and June, a Level Global technology analyst had about seven phone calls with Manosha Karunatilaka, a PGR expert who worked at TSMC and has pleaded guilty to supplying inside information to investment fund clients, prosecutors said. The Level Global technology analyst, Spyridon “Sam” Adondakis, was overseen by Mr. Chiasson and is cooperating with the government’s investigation, the Journal has previously reported, citing people familiar with the situation.
And now this is happening: Read more »
It probably shouldn’t come as much of a shock that the employees of a business that’s shutting down will most likely not be receiving bonuses this year but we can still allow them their pain. Read more »
The following letter was just sent to investors.
David Ganek’s Level Global, one of the three hedge funds raided last fall as part of the Feds’ insider trading case, has received approximately $750 million in redemption requests, according to people familiar with the matter. Read more »
A few weeks before Christmas, documents were released by the government revealing that at least one of the cooperating witnesses in its Insider Trading Fest(ivus) was currently employed at a hedge fund. Some people said the CW was with Level Global. The firm assured clients earlier this week that after conducting “extensive internal factual correlation analysis and cross-referencing the facts in the complaints to our firm’s records,” they can say confidently such is not the case.
Dear Investor:
We are writing to address investor inquiries related to the two most recent complaints filed by the U.S. Attorney’s Office in connection with the Government’s ongoing investigation into alleged insider trading in the financial services industry. As
you know we have been cooperating with the U.S. Attorney’s Office and have met with them on several occasions, in part, to discuss the challenges posed by speculation in the press about its investigation and Level Global’s need to communicate candidly with our investors.
“Contrary to speculation in the media, redemptions have been immaterial — amounting to less than 10 percent of our capital base,” the fund said in a letter to clients. “As you can appreciate, we simply cannot respond to every rumor circulating in the media,” Level Global continued. “We can, however, reiterate what we have already said — that we are not a target of the government’s investigation and that we are cooperating fully.” [Reuters]
- Use the Bloomberg command
NH BLG_DEALBREAKER <GO>
to access Dealbreaker
