Joseph “Chip” Skowron III obviously didn’t plan on being involved in a huge insider trading scandal – he didn’t even want to be a financier. He wanted to be a doctor.
He graduated from Yale in 1998 with a medical degree, not an MBA. He earned a doctorate in cellular biology, not in statistics.
In fact, he even began a five year orthopedic residency at Harvard in which only 10 doctors are selected for surgery training, according to the Wall Street Journal.
He wrote papers like “Cloning and characterization of mouse brush border myosin-I in adult and embryonic intestine.”
But three years into the program, the man who is at the centre of an insider trading case involving FrontPoint Partners and French doctor who allegedly tipped the firm off, packed up and left. In the same year, Chip Skowron joined SAC Capital, and his Wall Street career began.
He was not at SAC long, the WSJ reports – less than a year. Then it was onto Millenium Partners and then FrontPoint and a $6 million mansion in Greenwich. At all three hedge funds Skowron was appointed to analyse and focus on health-care-related stocks.
From the Wall Street Journal,
Dr. Skowron traveled in elite political and social circles, as a major donor to John McCain’s 2008 presidential campaign… and a member of the exclusive Monticello Motor Club, an automotive resort and track outside of New York City. The club’s sign-up fees start at $25,000 and among the members are racer Jeff Gordon and comedian Jerry Seinfeld, the president of the club said.
Along the way, the 41-year-old husband and father amassed a collection of luxury cars that has included a blue Ferrari 458 and a black Porsche Cayenne, according to state records.
Skowron allowed his medical licence to expire but the WSJ found that he has applied for a new licence. It’s probably a good idea.
Skowron was suspended from FrontPoint pending the outcome of an SEC investigation into alleged insider trading between the fund and Dr. Yves Benhamou, who worked for drug company, HGSI.
Benhamou is alleged to have shared confidential drug trial information with a health-care portfolio manager at FrontPoint (Skowron was never actually named in the filing) that allowed the firm to avoid $30 million in losses. Skowron denies the allegations. His lawyer told the WSJ:
Dr. Skowron is proud of his work as a physician, investor and philanthropist. He denies receiving confidential information about the Achieve trial. It is unfortunate that the government has taken the drastic step of arresting and imprisoning Dr. Benhamou, an eminent physician, on the basis of circumstantial allegations that we believe are untrue.
Since his suspension, Skowron has poured himself into volunteer work.
He was the national director of AmeriCares, a non-profit that provides disaster relief and care to HIV-positive children in Connecticut, but stepped down indefinitely in the wake of the scandal. Skowron says he carries a photo of himself with a six-year-old boy whose legs he saved in a Kosovo operation room, every day. As soon as Hurrican Katrina hit, he flew to Louisiana to set up a medical clinic in Baton Rouge.