Wednesday, 1 October 2014
Last updated 3 hours ago
Feb 3 2010 | 2:11pm ET
A former hedge fund manager and admitted insider-trader wore a wire as part of the Galleon Group probe, linking the two largest insider-trading cases in U.S. history.
David Slaine, a former trader for Galleon, pleaded guilty in December to conspiracy and securities fraud charges stemming from a 2007 that ensnared 13 people. That was the largest insider-trading case ever until last year, when Galleon founder Raj Rajaratnam and 20 others were charged—with an assist from Slaine.
Slaine, who has been cooperating with the authorities for more than a year, wore a wire that produced some of the huge number of tapes and wiretaps that are at the heart of the Galleon case. He has also accused Craig Drimal, a former Galleon employee who pleaded not guilty to fraud charges this week, of trading on non-public information.
Slaine pleaded guilty in December to trading on insider tips about stock ratings changes by UBS Securities while at Chelsey Capital in 2002, earning the hedge fund more than $3 million. He also netted some $500,000 trading in his own account. The U.S. Securities and Exchange Commission filed a civil suit against Slaine yesterday.
Slaine’s link to the Chelsey insider-trading case was not known until his guilty plea was unsealed yesterday. He was identified as a cooperating witness in the Galleon case by defendant Zvi Goffer’s lawyer on Jan. 29.
“Slaine knew, or should have known, that this information was being tipped in breach of duty to UBS,” the SEC said.
Chelsey is also where Mark Lenowitz and Eric Franklin, who have also been charged in the 2007 case, worked. In addition to his stints at Galleon and Chelsey, Slaine once worked at Morgan Stanley and CJS Capital, a hedge fund he managed with two former SAC Capital Advisors employees.
Slaine faces up to 25 years in prison at his sentencing on June 25.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
High frequency trading is not evil, it is not a conspiracy and it really is not new; it is the natural evolution of the professional trading community making markets, providing liquidity and hopefully...