Ex-Compliance Chief Accuses Hedge Fund CEO Of Front-Running

Nov 11 2008 | 9:23am ET

A former hedge fund compliance chief is accusing his old boss of favoring his interests of those of the fund’s investors in a wrongful termination lawsuit.

Joseph Sullivan says he was fired as chief compliance officer at New York-based Peconic Partners after questioning some of CEO William Harnisch’s trading. According to the lawsuit, filed in New York State Supreme Court, Harnisch engaged in front-running of Potash Corp. shares, selling his own stake in the fertilizer company for about $130 per share just days before unloading the fund’s stake for about $40 less per share.

Potash Corp. shares fell be more than half last month and closed yesterday at $81.63.

Sullivan’s lawyer, Alan Sklover, told the New York Post that the Securities and Exchange Commission had been notified of his client’s accusations against Harnisch.

For his part, Harnisch dismissed Sullivan’s claims as those of a “disgruntled employee,” according to the Post. He called the allegations “ridiculous.”

Peconic manages $1.5 billion in assets.


In Depth

Q&A: Quad Advisors’ Borish Is Looking For Real Traders, Not Index Huggers

Aug 20 2014 | 1:43pm ET

Peter Borish, who served as founding partner and director of research at Tudor Investment...

Lifestyle

Viking Manager In Rent Dispute

Aug 11 2014 | 4:14am ET

A hedge fund manager is demanding most of his money back from his former landlord...

Guest Contributor

Majority Of Inflows Go To Brand Name Hedge Funds

Aug 12 2014 | 9:00am ET

Since the market correction of 2008, a vast majority of hedge fund net asset flows...

 

Editor's Note

 

Futures Magazine

PREVIEW July/August 2014 Cover

Inside Futures' 500th Issue

The July/August 2014 issue is our largest in years—filled with the best trading strategies and stories from 43 years of being the primary publication for commodity, stock, options and forex traders.

The Alpha Pages

TAP July/August 2014 Cover

Real talk on alternative investments, business & finance

The Alpha Pages Editor's Note