Hedge Fund Tipsters Avoid Jail

Jul 2 2013 | 2:26am ET

Two corporate insiders who passed confidential tips to hedge funds were spared prison terms yesterday as a reward for their cooperation.

Mark Longoria and Walter Shimoon were each sentenced to time served—a day in jail each—and two years of supervised release. The two were also ordered to forfeit money they received as expert-networkers for providing the information: $170,000 for Longoria and $45,000 for Shimoon.

Both men pleaded guilty in 2011.

“It is because the very nature of this crime and the very nature of its discovery is usually dependent on the use of cooperators,” U.S. District Judge Jed Rakoff said. “The cold, realistic fact is a price has to be paid for that cooperation and it takes the form of a substantial reward in the form of reduced jail time.”

Longoria worked at Advanced Micro Devices and Shimoon at Flextronics International; both moonlighted as consultants for Primary Global Research, which connected them with the hedge funds that received their tips. Shimoon, who also consulted for Broadband Research, passed information to 11 hedge funds, while Longoria admitted to tipping Barai Capital Management and Spherix Capital.


In Depth

Creating An Offshore Hedge Fund Dream Team: The Seven Key Players

Jun 26 2015 | 6:47am ET

If you want to set up an offshore hedge fund, like any great team, you’re only...

Lifestyle

Hedgies Set to Compete in Wall Street Decathlon

Jun 8 2015 | 12:37am ET

The Wall Street Decathlon — a 10-event physical challenge that will crown “Wall...

Guest Contributor

6 Essential Principles To Balance Your Investment Risk

Jun 26 2015 | 10:07am ET

In this article, financial expert Greg Silberman explores how to hedge a private...

 

Editor's Note