The hits keep coming against hedge funds.
Authorities in New York announced today the indictment of Joseph Contorinis, a former portfolio manager at Jefferies Paragon Fund arrested in Feburary, on charges of conspiracy and securities fraud relating to $7 million in profits he allegedly made through insider trading.
According to the DA, from 2004 through June 2006 he executed securities trades based on inside information on M&A deals that he got from buddy Nicos Stephanou, an investment banker at UBS in London.
For example, from late 2005 through early 2006, Stephanou was on the investment banking team representing a private equity firm that was interested in acquiring Albertson’s Corporation. He tipped Contorinis about positive and negative developments on the deal, who then traded on the information, making more than $7 million for his fund.
As Bloomberg notes, charges against a third defendant, Ramesh Chakrapani of Blackstone Group, were dismissed in April.
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