Hedge Fund Managers Convicted of Insider-Trading Scheme
By Patricia Hurtado - Dec 18, 2012 12:01 AM ET
Anthony Chiasson and former Diamondback Capital Management LLC portfolio manager Todd Newman were convicted of securities fraud and conspiracy for an insider-trading scheme that reaped more than $72 million.
After deliberating a little more than two days, a federal jury in New York found both men guilty of conspiracy to commit securities fraud for a scheme to trade on Dell Inc. (DELL) and Nvidia Corp. (NVDA) using illicit tips.
The panel found Chiasson, 39, guilty of five counts of securities fraud, earning Level Global $68.5 million on inside tips trading on the two technology company stocks. Newman, 48, was convicted of four counts of securities fraud related to trades on inside information that earned his fund about $3.8 million.
“We had all the evidence we needed,” said Felicia Rivera, a juror from Westchester County near New York City, said after court.
Harper Buonanno, another juror, said the panel considered the testimony of the four cooperating witnesses, including two analysts who worked for the defendants.
“We had a lot of the government’s documentary evidence, including the witnesses’ testimony,” Buonanno said after yesterday’s verdict. “We had a lot of evidence available to us. We used it all.”
71 Convictions
Manhattan U.S. Attorney Preet Bharara’s office has charged 75 people with insider trading since October 2009. Seventy-one of those pleaded guilty or were convicted after trial. Newman and Chiasson, after the seventh trial connected to the probe, are the ninth and 10th defendants convicted by federal juries in Manhattan.
The two men face as long as 20 years in prison for securities fraud when they are sentenced by U.S. District Judge Richard Sullivan on April 19.
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