Falcone Ban Approved By Judge

Sep 17 2013 | 11:27am ET

Harbinger Capital Management founder Philip Falcone is officially out of the hedge fund business.

A federal judge in New York yesterday signed off on Falcone's settlement with the Securities and Exchange Commission, which features a five-year ban on managing hedge funds. Falcone will still be permitted to run his listed permanent-capital vehicle and wireless Internet venture LightSquared.

The ban and $18 million fine are "appropriate and proportionate to the defendants' admitted wrongful conduct," U.S. District Judge Paul Crotty said.

Falcone was forced to admit wrongdoing as part of the deal, part of SEC Chairman Mary Jo White's push to limit the agency's former standard practice of allowing almost all defendants settle without admitting or denying guilt. Indeed, the SEC rejected an earlier settlement with Falcone that did not include an admission of wrongdoing.

The SEC sued Falcone and Harbinger last year, accusing the hedge fund manager of taking an improper loan from the firm to pay his taxes, of granting Goldman Sachs preferential redemption treatment and of market manipulation.


In Depth

Debunking Conventional Investment Wisdom

Feb 8 2017 | 3:22pm ET

Due diligence in the hedge fund world has long involved some combination of the...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

The Future of Private Equity: New Opportunities, New Challenges

Feb 3 2017 | 6:41pm ET

The private equity industry’s astonishing rebound since the financial crisis has...

 

From the current issue of