Harbinger's Falcone Offers Details On SEC Investigations

Apr 29 2011 | 1:33pm ET

Philip Falcone, the billionaire behind Harbinger Capital Partners, has given his investors more information about three U.S. government investigations into his $6 billion firm.

Reuters quotes a private, year-end financial statement in which Falcone acknowledges the SEC is looking into whether Harbinger violated a short-selling rule involving three stocks in 2008 and whether it engaged in market manipulation in unnamed debt securities between 2006 and 2008.

The financial statement also shows that his firm paid $60 million to settle a suit with Nacco Industries. The company, which sells appliances under the Hamilton Beach brand, sued Harbinger for allegedly using non-public information to derail its acquisition efforts.

The regulation in question in the short-selling investigation is Rule 105 which says investors cannot participate in the public offerings of securities they’ve shorted.

Falcone called the probes “informal,” said his firm was “cooperating” with the investigations, and underlined that no criminal charges had been laid.

The Harbinger head also told investors that regulators were still looking at a $113 million personal loan he took from the hedge fund—and repaid in full in 2010.

Reuters quotes a person close to the situation who says Falcone revealed all to investors in the name of transparency.

The filing also says Harbinger has a $250 million unfounded commitment to LightSquared, a wireless telco of which Harbinger now controls about 80%. Harbinger has invested some 40% of its assets in the telco.


In Depth

Q&A: Executive Recruiter Talks Hedge Fund Closures, Hiring Trends

Dec 19 2014 | 6:58am ET

This year, hedge funds have been closing at a rate not seen since the financial...

Lifestyle

Cooper-Hohn Won't Contest Divorce Settlement

Dec 18 2014 | 9:51am ET

The ex-wife of hedge fund billionaire Christopher Hohn will not contest a divorce...

Guest Contributor

Alternative Investment Funds Face A Communications Imperative

Dec 19 2014 | 6:10am ET

A handful of the top alternative investment firms on both sides of the Atlantic...

 

Sponsored Content

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

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

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.