Saturday, 28 February 2015
Last updated 23 hours ago
Nov 15 2012 | 12:40pm ET
A former analyst at Diamondback Capital Management analyst told jurors that has passed confidential tips he received to a number of people, including his boss at Diamondback and a Level Global Investors analyst who claimed to hand them up to that firm's founders.
Jesse Tortora, who has pleaded guilty to fraud charges and who is cooperating with prosecutors, was the first witness to take the stand at the trial of Level Global co-founder Anthony Chiasson and former Diamondback portfolio manager Todd Newman. And he wasted little time in tarring other admitted and alleged members of his "criminal club," including the defendants and several people who have not been charged in the case.
Tortora said he received confidential information about technology companies from former Dell Inc. employee Sandeep Goyal and other corporate insiders. He then passed those tips on to Newman, former Level Global analyst Spyridion Adondakis and former SAC Capital Advisors analyst Jon Horvath. All three of those men have pleaded guilty in the case, and Goyal and Adondakis are expected to testify.
According to Tortora, both Adondakis and Horvath told him they passed his tips to their bosses, "for the purpose of trading on" them. And Tortora said Adondakis didn't just give the information to Chiasson, but also to Level Global's other founder, David Ganek, while Horvath allegedly said he gave the information to SAC's Michael Steinberg. Neither Ganek nor Steinberg has been charged with any wrongdoing, but Steinberg has been identified as an unindicted co-conspirator and put on leave from SAC.
Steinberg would not comment, but Ganek's lawyer said that "with the trial now underway it speaks for itself" that no one else has been charged and that he hasn't "heard anything from the government about my client."
In their opening statements on Tuesday, lawyers for Chiasson and Newman attacked Tortora and Adondakis, and claimed their clients had no idea their subordinates were trading in insider information. Newman's lawyer said that his client's "biggest mistake" was hiring Tortora.
Jan 23 2015 | 1:00pm ET
In our new section, FINtech Focus, we will profile one of these firms each week. While fintech is a broad category, we will be focusing on firms that specifically cater to the alternative investment industry. Read more…