Ex-Jefferies Hedge Fund Manager Guilty Of Insider-Trading

Oct 7 2010 | 12:34pm ET

A former Jefferies Group hedge fund manager has been convicted of insider-trading.

Joseph Contorinis was found guilty of one count of conspiracy and seven counts of securities fraud charges yesterday. The former general partner of Jefferies Asset Management’s Paragon Fund faces up to 20 years in prison at his sentencing in February.

Contorinis was arrested last February, accused of both leaking confidential information about the 2006 acquisition of supermarket chain Albertsons to family and friends, and of using it himself. All told, according to the authorities, the former made $11.6 million in illicit profits, while the Paragon fund earned an illegal $7.2 million.

Following a three-week-long trial in Manhattan federal court, it took a jury just two days to reject Contorinis’ argument that his frequent trading in Albertsons shares made it impossible for him to profit from the non-public information.

“On top of this office’s recent insider-trading convictions, today’s guilty verdict sends yet another strong message of deterrence to anyone who is thinking about gaming the system like Joseph Contorinis did,” Manhattan U.S. Attorney Preet Bharara said.

Contorinis’ conviction is the fourth in the Albertsons case. Three others pleaded guilty, including former UBS banker Nicos Stephanou, who served as a key witness against Contorinis.


In Depth

Q&A: Rotation Capital's Rothfleisch On SPAC 2.0

Aug 11 2017 | 7:43pm ET

Corporate actions have long been a staple of event-driven investors, but activity...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Star Mountain: Private Lending in the Lower Middle-Market

Aug 14 2017 | 4:45pm ET

Private credit has become one of the most popular alternative asset classes in recent...

 

From the current issue of