Hedge Fund Manager, SEC Settle PIPE Charges

Dec 22 2005 | 8:47pm ET

Hedge fund manager John Mangan, who was formerly registered as a broker with Friedman, Billings, Ramsey & Co., has been permanently barred from associating with any NASD-registered firm. He has also been ordered to pay a $125,000 fine to settle charges that he deceptively obtained shares in a PIPE transaction, improperly sold the shares short and shared in profits from the shares without obtaining permission from FBR.

NASD found that Mangan wanted to invest in shares in Compudyne through a hedge fund he managed with a partner, so he contacted senior FBR executives to inquire whether he had permission to do so. He was told not invest in the Compudyne PIPE, however, he went ahead and arranged for HLM Securities, an investment advisor owned by Mangan's partner, to buy 80,000 shares in the PIPE.

In settling this matter with NASD, Mangan neither admitted nor denied the charges. NASD's investigation into other individuals and entities involved in the Compudyne PIPE is continuing.

In May, Hilary Shane, a hedge fund manager formerly registered with First New York Securities, was barred and ordered to pay more than $1.45 million in fines and restitution by the NASD and the Securities and Exchange Commission to settle fraud and insider trading charges arising from her purchase and sale of Compudyne PIPE shares.


In Depth

AIMA: Smaller Firms Remain the Lifeblood of the Hedge Fund Industry

Jul 26 2017 | 5:55pm ET

It is a hedge fund industry truism that the largest managers receive the most attention...

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

Rastegar: PE Real Estate Gains Momentum as Uncertainty Rises

Jul 21 2017 | 6:04pm ET

The steady march of equity markets and fundamental shift in the direction of Fed...

 

From the current issue of