Calif. Hedge Fund Analyst Arrested For Insider-Trading

Mar 27 2013 | 10:45am ET

A hedge fund analyst and his alleged tipster were arrested and charged yesterday with insider-trading.

Prosecutors said that Matthew Teeple, an analyst for an unidentified San Francisco hedge fund, was told of Foundry Networks' impending acquisition by Brocade Systems in 2008 by Foundry's then-chief information officer, David Riley. Both men were charged with conspiracy and securities fraud and face up to 65 years in prison.

Riley's tip helped Teeple's hedge fund earn more than $16 million and avoid losses of more than $11 million. Teeple then passed the information to two other men, both of whom have pleaded guilty: John Johnson, a portfolio manager for a Denver asset manager who entered his plea on March 18, and Karl Motey, a key government cooperating witness who played a major role in the crackdown at expert-network Primary Global Research.

"There may be little to distinguish this case from the dozens of others we have made against industry insiders and investment advisers in the past several years," George Venizelos of the Federal Bureau of Investigation said. "There is certainly nothing unique about the outcome: If you allegedly traffic in inside information, by providing it or trading on it, you will inevitably be found out, charged, and prosecuted."

Teeple, Riley and Johnson were also sued by the Securities and Exchange Commission.

Teeple and Riley where both arrested in California yesterday. "Mr. Teeple intends to vigorously defend himself against the government's allegations," Teeple's lawyer said.


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

Nowhere to Hide: Why the Future of Asset Management Depends on Innovation

Nov 15 2016 | 6:55pm ET

Information technology has reshaped the asset management industry’s periphery,...

 

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