Ex-Hedge Fund Managers Seek Reversal Of Insider Convictions

Apr 21 2014 | 1:34pm ET

Once again, a federal appeals court in New York will tomorrow hear from convicted hedge fund insider-traders seeking to have their guilty verdicts overturned.

Anthony Chiasson and Todd Newman plan to argue that as “downstream tippees,” they were unaware that the sources of their information were being compensated for it. Their lawyers say that such a demonstration is required to sustain an insider-trading conviction.

Chiasson, the co-founder of Level Global Investors, and Newman, a former portfolio manager at Diamondback Capital Management, were convicted of fraud in 2012. The former was sentenced to six-and-a-half years and the latter four-and-a-half years in prison, although both remain free pending the appeal.

Prosecutors say that the two were part of a “corrupt circle” that traded in insider information. Both received tips from their analysts, who cooperated with prosecutors.

To date, none of the people convicted in the recent government crackdown on insider-trading have succeeded on appeal. But Chiasson’s and Newman’s lawyers argue that the judge in their trial came to the opposite conclusion reached by four other federal judges in such cases.


In Depth

Q&A: Star Mountain's Brett Hickey On Investing In 'The Growth Engine Of America'

Sep 22 2017 | 5:06pm ET

Lower middle-market companies form the economic fabric of the nation, but they can...

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

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...

 

From the current issue of