Accused FrontPoint Tipster Wins Bail

Nov 17 2010 | 12:45pm ET

Yves Benhamou, the French doctor accused of passing inside information to hedge fund FrontPoint Partners, won bail today for the first time since his arrest more than two weeks ago.

U.S. Magistrate Judge Frank Maas set bail at $3 million. Benhamou—who lives in France—will be placed under "house" arrest in the U.S. and will have to surrender his passport. His bond must be secured by $1 million in cash or property in the U.S. and he must find three co-signers for his bond.

Benhamou remains in jail until the bail conditions are met.

Benhamou was arrested at a nephrology conference and charged with using his position as an adviser to pharmaceutical company Human Genome Sciences to pass advanced information about a disappointing drug trial to six hedge funds. FrontPoint, which has not been accused of any wrongdoing in the case, acknowledges that it is one of them and has placed Joseph Skowron, its lead healthcare fund manager, on leave pending the conclusion of the investigation.

FrontPoint allegedly escaped $30 million in losses with Benhamou's information.

Prosecutors had argued against granting Benhamou bail, noting that he is a millionaire with ample means and motivation to flee. They also pointed out that the U.S. and France do not have an extradition treaty—even citing the case of famed film director Roman Polanski, who has been a fugitive from U.S. justice living in France for more than 32 years.

Benhamou faces up to 25 years in prison if convicted.

Benhamou's lawyer countered with letters from doctors and patients pleading for Benhamou's freedom. David Zornow said his client, who denies any wrongdoing, wants the freedom to continue treating his patients.

"It would be truly tragic to have this man with his knowledge sitting in prison when he could be helping people," Zornow said.


In Depth

Q&A: Quad Advisors’ Borish Is Looking For Real Traders, Not Index Huggers

Aug 20 2014 | 1:43pm ET

Peter Borish, who served as founding partner and director of research at Tudor Investment...

Lifestyle

Nicky Hilton To Wed James Rothschild

Aug 20 2014 | 5:23am ET

When it comes to husband-material, socialite Nicky Hilton is sticking with finance...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

 

Futures Magazine

PREVIEW July/August 2014 Cover

Inside Futures' 500th Issue

The July/August 2014 issue is our largest in years—filled with the best trading strategies and stories from 43 years of being the primary publication for commodity, stock, options and forex traders.

The Alpha Pages

TAP July/August 2014 Cover

Real talk on alternative investments, business & finance

The Alpha Pages Editor's Note