Hedge Fund Settles Insider Trading Case for $600 Million
The Securities and Exchange Commission says it has won the largest ever settlement in an insider trading suit.
The Securities and Exchange Commission says it has won the largest ever settlement in an insider trading suit.
CR Intrinsic Investors, which admitted no wrongdoing in the settlement, had been accused of profiting from illegally obtained information about an Alzheimer’s drug.
WAIT BEFORE YOU GO...The Wall Street Journal:
“The historic monetary sanctions against CR Intrinsic and its affiliates are a sharp warning that the SEC will hold hedge fund advisory firms and their funds accountable when employees break the law to benefit the firm,” George S. Canellos, acting director of the SEC’s Division of Enforcement, said in a statement.
The SEC said in its complaint that Sidney Gillman, a doctor who moonlighted as a medical consultant, tipped CR Intrinsic portfolio manager Mathew Martoma with safety data and eventually negative results in the trial of the drug made by drug firms Elan Corp. and Wyeth two weeks before they were made public in 2008. Martoma and CR Intrinsic then caused several hedge funds to sell more than $960 million in Elan and Wyeth securities in a little more than a week.
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