Hedge Fund Sues CBOE Over ‘Insider Trading’

Dec 29 2010 | 4:51am ET

Hedge fund Platinum Partners has sued the Chicago Board Options Exchange, accusing it of accidentally giving some investor advance notice of a change to the strike price of a listed fund.

The New York-based firm said it lost $10 million when the CBOE and Options Clearing Corp. mistakenly cut the strike price on India Fund options and then improperly gave that information to some market participants. In addition to the CBOE and OCC, Platinum names the sellers of the India Fund options as John Doe defendants.

“We’re not the litigious type of people,” Platinum chief Mark Nordlicht told Crain’s Chicago Business. “It’s just an unfortunate situation. There was clearly some insider trading that went on before the decision was publicly announced.”

Platinum’s suit was filed in Illinois state court in Chicago.

While Nordlicht may not be the litigious type, he’s certainly seen the inside of a courtroom before. In addition to leading Platinum, he is the co-founder and chairman of commodity broker Optionable Inc., which has been sued by the Bank of Montreal for allegedly helping a former trader conceal losses.


In Depth

Q&A: High Conviction, Low Correlation

Oct 30 2014 | 7:35am ET

Acadian Asset Management's numbers are big: over $70 billion in assets under management...

Lifestyle

Ex-Hedgie Steyer Gives $56M To Climate Action Super PAC

Oct 28 2014 | 9:23am ET

Retired Farallon Capital founder Tom Steyer has poured almost $56 million into his...

Guest Contributor

Hedge Funds Weather A Data Management Perfect Storm

Oct 22 2014 | 12:28pm ET

From a regulatory standpoint, nearly every development since the crisis has placed...

 

Videos

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

October 2014 Cover

Demeter: Family affair

David and James Hamman launched their fundamental Livestock and Grains Program in March of 2010 but it really was decades in the making.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.