Ex-Level Global Analyst Says He Tipped Boss, Level Global, SAC

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.


In Depth

'Smart Beta' Funds In Regulators' Sights, Hedgies May Be Next

Mar 26 2015 | 11:11am ET

Funds that mimic strategies used by active managers for a fraction of the cost could...

Lifestyle

Study: Both Marriage and Divorce Lead to Negative Hedge Fund Performance

Mar 25 2015 | 6:51pm ET

Trouble at home leads to trouble in the market for fund managers, according to researchers...

Guest Contributor

The Life Settlement: Yield For The Investor And Cash For The Consumer

Mar 31 2015 | 6:48am ET

Investors are languishing in a yield-starved, low-interest rate environment, looking...

 

Sponsored Content

    Mar 9 2015 | 6:35am ET

    Kelly RodriquesKelly RodriquesAs more investors look to diversify, many are beginning to use retirement funds to invest in alternative assets such as private equity and real estate. Kelly Rodriques, CEO & President of PENSCO Trust Company, explains how companies can connect with those looking to use their retirement accounts in a different way. Read more…

Editor's Note