Visium Asset Management Discloses SEC, Justice Probes

Mar 7 2016 | 8:42pm ET

Alternative investment manager Visium Asset Management has disclosed investigations by U.S. securities regulators and the U.S. Department of Justice regarding trading and valuation of certain securities held in a credit fund that closed more than two years ago. 

The company, which manages more than $7 billion in assets across a variety of equity strategies, is providing the information requested by the investigation, according to a report in The Wall Street Journal. The inquiry is reportedly also concerned with the use of a consultant to the firm and certain trading activities.  

Visium’s Credit Opportunities Fund was launched in 2009 and focused primarily on capital-structure opportunities within the healthcare sector. Visium’s founder, Dr. Jacob Gottlieb, has a background in medicine and originally concentrated Visium on healthcare-related investing before branching out.

The investigation was disclosed to employees and investors in a letter on Monday. 

Gottleib founded Visium in 2005 after a stint at Balyasny Asset Management, which spun it off into a new firm. The fund reportedly carries leverage of up to 2.5x and is split relatively evenly between healthcare stocks and other types and sectors of investments, according to the Journal citing unidentified persons familiar with the matter.

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