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

Don’t Overlook These 6 Hybrid Cloud Concerns

Sep 14 2017 | 6:27pm ET

Cloud-based technology solutions have made tremendous inroads into the alternative...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Cash: An Asset In Adolescence

Aug 31 2017 | 3:34pm ET

If the investment industry has a rebellious teenager in the house today, that teenager...

 

From the current issue of