Citadel Denies Having 'Insider Trading Group'

Jul 26 2013 | 11:24am ET

Citadel Investment Group moved to distance itself from the criminal charges against SAC Capital Advisors, saying that it never had an "insider trading group."

The SAC indictment includes the allegation that the hedge fund hired Richard Lee from Citadel in 2009 despite warnings that Lee was a known member of Citadel's "insider trading group." Lee pleaded guilty to illegal trading while at SAC this week.

Citadel, which has not been accused of any wrongdoing, defended itself against the allegation.

"Citadel does not have, and never has had, an 'insider trading group,'" it said. "Citadel has strict rules against, and oversight designed to prevent, insider trading. Any suggestion to the contrary is baseless and without merit."

Citadel elaborated on its reasons for firing Lee, which it said had nothing to do with insider-trading. Instead, the hedge fund said, Lee had violated its policies on internal transfers of positions.

"Mr. Lee's actions would have impacted only his potential future compensation," Citadel said. "Within hours, Mr. Lee's misconduct was reported to Citadel management. Mr. Lee was immediately terminated."


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

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.