FBI Blamed for Demise of Hedge Funds Following Failed Insider Trading Case
Investors can be a skittish bunch.
When they heard of the federal government’s suspicions of insider trading involving two hedge funds, Level Global Investors and Diamond Capital Management, they fled and the funds shut down, the New York Times reports.
On Wednesday, the two men found guilty of insider trading, Todd Newman and Anthony Chiasson, were vindicated when a federal appeals court overturned their convictions.
The found of Level Global, David Ganek, blamed the FBI for the hedge fund’s demise.
“For the dozens of my high-integrity colleagues at Level Global who lost their jobs and their reputations because the F.B.I. improperly raided our firm in this now-discredited fishing expedition, today’s legal vindication is a reminder of how prosecutorial recklessness has real impact on real people,” Mr. Ganek said in a statement sent by a spokesman.
Newman and Chiasson were found guilty by a jury two years of ago of conspiring to earn millions of dollars making taxes based on inside secrets.
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