Feds Turn To Healthcare Stocks In Insider Probe

Feb 29 2012 | 4:32am ET

Technology stocks have dominated the insider-trading cases brought in the U.S. over the past two years. But they're set to play second fiddle to a new star industry for illegal tipping.

Trading in and on confidential information about pharmaceutical and biotechnology companies is now "front and center" of the U.S. Justice Department investigation, the Financial Times reports. Authorities are looking into hedge funds trading around major announcements by such companies.

Earlier this week, the Federal Bureau of Investigation said it was investigating about 250 people for insider-trading, about half of whom it hoped to build criminal cases against.

A focus on insider-trading in pharmaceuticals and biotech is not entirely new: Last year, two men pleaded guilty in an insider-trading scam that helped sink FrontPoint Partners, including that hedge fund's former top healthcare manager, Joseph Skowron. Also last year, Massachusetts authorities sued hedge fund Risk Reward Capital Management for trading on confidential information received from expert network consultants.


In Depth

Fundraising for Mid-Sized PE Funds: Should You Use a Registered B/D?

Dec 6 2016 | 7:18pm ET

When does a fund sponsor need to use a registered broker/dealer when raising capital...

Lifestyle

Trump Attends 'Villains and Heroes' Costume Party Dressed As...Himself

Dec 5 2016 | 11:16pm ET

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party...

Guest Contributor

A Hard Look At Your ‘Soft’ Hedge Fund Marketing Information

Dec 8 2016 | 9:03pm ET

Conventional wisdom holds that due diligence examines quantitative as well as qualitative...

 

From the current issue of

Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information. 

AVAILABLE NOW at BARNES & NOBLE

NEWSTAND LOCATOR