Ex-Hedge Fund Manager To Prison For Carter’s Trades

Jul 9 2014 | 9:26am ET

A former hedge fund manager will soon be in prison with two former executives of the company whose shares he allegedly insider-traded in prison.

Mark Megalli was sentenced to one year and one day in prison yesterday, and ordered to pay $50,000, for trading shares of Carter’s Inc. based on tips he received from a former vice president at the children’s clothing company. Megalli, who worked at Level Global Investors—shuttered in 2011 as a result of an unrelated insider-trading scandal—pleaded guilty to fraud charges last year.

U.S. District Judge Richard Story in Atlanta also sent Megalli’s tipster, Eric Martin, to prison for two years. Martin’s source at Carter’s after his departure, former vice president of operations Richard Posey, got a year and three months.

Megalli’s lawyer said his client “is fully satisfied with and accepting of the outcome.”

Prosecutors say that Megalli traded on tips from Martin in 2009 and 2010, earning level global between $2.5 million and $7 million.


In Depth

FINalternatives Survey: We Asked Investment Pros...

Apr 2 2016 | 9:42pm ET

The data from our annual reader survey continues to roll in and provide interesting...

Lifestyle

Point72's Cohen Donates $275M To Veterans Mental Health Network

Apr 6 2016 | 8:31pm ET

Billionaire hedge fund manager Steve Cohen has formed a non-profit aimed at treating...

Guest Contributor

Agecroft: Why NYCERS Should Reconsider Exiting All Hedge Funds

Apr 18 2016 | 5:51pm ET

The recent decision by the New York City Employment Retirement System to exit its...