Ex-Level Global Analyst Fingers Chiasson

Nov 28 2012 | 1:08am ET

The government's second key witness in the latest hedge fund insider-trading trial testified yesterday that he had passed non-public tips to his boss at Level Global Investors, co-founder Anthony Chiasson.

Spyridion Adondakis, who is cooperating with prosecutors and has already pleaded guilty, told a federal jury in New York that he told Chiasson that he had a contact at another hedge fund who could feed him insider information about Dell Inc. That person was Jesse Tortora, a former Diamondback Capital Management analyst who testified earlier in the trial against his own former boss, Todd Newman.

"I explained to him the full chain of command," Adondakis said.

"How did Mr. Chiasson react?" prosecutor John Zach asked.

"He seemed interested, he wanted to see if we could use this information to make forecasts and to use it to make money," Adondakis replied.

And use it they did, he told the jury. A year later, in 2008, Adondakis said he told Chiasson and another executive at the firm, Greg Brenner, that he knew that Dell's gross margins would be lower than expected.

"Brenner mentioned that if this information was right, it would be the best idea of the firm and it would be a very profitable position for the firm," Adondakis said. He then said that Brenner, who has not been charged with any wrongdoing, and Chiasson took his analysis to Level Global co-founder David Ganek. Adondakis said he could not hear the content of that conversation, but that Level Global increased its short bet against Dell.

Chiasson later told members of the technology group at Level Global "that we had a large position in Dell, a short position, and it was based on a contact and that we were not to discuss the position outside of the fund."

Ganek has not been accused of any wrongdoing.


In Depth

Q&A: Open Season For Closed-End Funds

Aug 29 2014 | 10:00am ET

When Maury Fertig and Bob Huffman, former Salomon Brothers coworkers, launched...

Lifestyle

Och Funds Women In Finance Initiative At U-M

Aug 28 2014 | 3:01pm ET

Och-Ziff Capital founder Daniel Och and his wife have made a "generous donation"...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

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.