Denver Hedge Fund Implicated In Insider-Trading Scam

Aug 9 2011 | 12:47pm ET

Another hedge fund has been ensnared in another insider-trading scandal.

Father and son H. Clayton and Drew Peterson pleaded guilty to securities fraud and conspiracy charges on Friday. And Drew Peterson, who is cooperating with prosecutors, admitted to tipping off a hedge fund, which, in turn, made $4.6 million in allegedly ill-gotten profits on the information.

The Denver-based hedge fund was not identified in either the criminal complaint or the Securities and Exchange Commission lawsuit. But it was notified in advance about oil-and-gas company Mariner Energy’s acquisition by Apache Corp. in April 2010.

Drew Peterson told the hedge fund manager that his father, a Mariner director, “had recently attended Mariner board meetings and something good was going to happen for Mariner.”

In addition to the $4.6 million the hedge fund manager earned for the fund, he made $130,000 for himself and $305,000 for his relatives. The Petersons earned $2.7 million on the insider information.


In Depth

Creating An Offshore Hedge Fund Dream Team: The Seven Key Players

Jun 26 2015 | 6:47am ET

If you want to set up an offshore hedge fund, like any great team, you’re only...

Lifestyle

Hedgies Set to Compete in Wall Street Decathlon

Jun 8 2015 | 12:37am ET

The Wall Street Decathlon — a 10-event physical challenge that will crown “Wall...

Guest Contributor

6 Essential Principles To Balance Your Investment Risk

Jun 26 2015 | 10:07am ET

In this article, financial expert Greg Silberman explores how to hedge a private...

 

Editor's Note