Thursday, 24 July 2014
Last updated 14 hours ago
Feb 7 2011 | 10:08am ET
At least 11 hedge funds were the beneficiaries of insider-information provided by Primary Global Research analysts, according to a newly-unsealed criminal complaint and the Securities and Exchange Commission's lawsuit against six people in the case.
The number 11 is mentioned in the SEC's suit against Walter Shimoon, a former Flextronics International executive and Primary Global consultant. Shimoon, who has been arrested and charged in the case, "spoke with representatives of at least 11 different hedge funds," none of which were identified.
What's more, those hedge funds acted on the information, according to brokerage records showing "that the hedge funds used the inside information that Shimoon provided during these calls to trade the securities of at least Flextronics" and Omnivision Technologies. Shimoon is also alleged to have passed on tips about Apple Inc. to "Hedge Fund No. 2" in November 2009.
In addition, the SEC said Shimoon passed tips on to Bob Nguyen, an employee of Primary Global. Nguyen and another Primary Global employee, James Fleishman, the complaint against whom was unsealed last week, allegedly acted as a conduit for Shimoon's tips, making summaries of his information available to clients.
Nguyen has pleaded guilty and is cooperating in the case.
Another hedge fund, also unidentified, had "regular communications" of another of the accused tipsters, Mark Longoria, and received confidential tips from him, the SEC alleged in its lawsuit against Longoria.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…