Sandell Probed For Alleged Katrina Short-Sales

Nov 2 2006 | 11:46am ET

New York-based Sandell Asset Management is sweating after receiving a Wells notice targeting the firm and several top executives. According to a letter sent to investors, the $7 billion New York hedge fund stands accused of naked short-selling of Louisiana bank Hibernia Corp.’s shares. The alleged short-sales occurred in the aftermath of Hurricane Katrina.

The letter said that the Securities and Exchange Commission “intends to recommend the commencement of proceedings” against Sandell and several executives, reportedly including Sandell founder Thomas Sandell, though the letter did not identify any individuals.

Sandell, in the letter, said it “[disputes] several of the commission’s assertions,” but that it is “continuing to work with the staff the resolve this matter.”


In Depth

Electronifie: Better Bond Trading

May 11 2016 | 3:03pm ET

Technology has revolutionized countless aspects of investing and trading, but the...

Lifestyle

From Modern Trader: Stephen Curry is a Black Swan

May 18 2016 | 7:43pm ET

What do the rise of the Internet, the sinking of the Titanic, 9/11, and Stephen...

Guest Contributor

LendingClub and the Question of Internal Hedge Funds

May 19 2016 | 8:42pm ET

Peer-to-peer lending platform LendingClub Corp. has been in the news since the firm...