David Ganek Sues U.S Attorney over Level Global Raid

Feb 27 2015 | 3:30pm ET

David Ganek has sued Manhattan U.S. Attorney Preet Bharara, members of his staff, and several FBI agents. The lawsuit centers on the 2010 raid of his hedge fund Level Global, which shut down several months later.

The widely reported raid helped lead to a conviction of Ganek's partner at Level Global, Anthony Chiasson. 

Chiasson was arrested two years after the raid and convicted of insider-trading.

However, the conviction was recently overturned by an appeals court, which said the government failed to provide enough evidence that Chiasson's trades fit the definition of insider trading.

Ganek called the court's reversal "vindication" for all of the Level Global employees who lost their jobs after the raid.

"The government's reckless search of Level Global needlessly damaged my reputation and the reputations of dozens of other good, honest people," Ganek said in a statement.

In the lawsuit, Ganek accuses the FBI, the U.S. Attorney, and others of "prosecutorial misconduct" for their role in a raid of the hedge fund. The event happened when the government conducted a widespread investigation into insider-trading allegations.

The hedge fund mogul says that the U.S. government conducted the raid on information that he claims was "fabricated."

Ganek's suit specifically claims that the search was conducted on false claims from a former analyst-turned-government witness to said that the boss know of insider trading at the fund. Ganek disputes the informant's claims, and says that the witness told government something completely different, according to the filing.


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