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SEC: Hedge Fund Managers And Former Government Official Charged In $32 Million Insider Trading Scheme - Separate Asset Mismarking Scheme Yielded $6 Million In Extra Fees

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The Securities and Exchange Commission today announced insider trading charges against two hedge fund managers and their source, a former government official accused of deceptively obtaining confidential information from the U.S. Food and Drug Administration (FDA).  A third hedge fund manager working at the same investment advisory firm as the alleged insider traders was charged with falsely inflating assets in portfolios he managed.
 
The SEC alleges that Sanjay Valvani reaped unlawful profits of nearly $32 million for hedge funds investing in health care securities by insider trading on tips he received from Gordon Johnston, who worked at the FDA for a dozen years and remained in close contact with former colleagues while working for a trade association representing generic drug manufacturers and distributors.  Johnston concealed his separate role as a hedge fund consultant and obtained confidential information about anticipated FDA approvals for companies to produce enoxaparin, a generic drug that helps prevent the formation of blood clots.  Johnston allegedly funneled to Valvani the details of his conversations with FDA personnel, including a close friend he mentored during his time at the agency.  Valvani then traded in advance of public announcements concerning FDA approvals for such companies as Momenta Pharmaceuticals, Watson Pharmaceuticals, and Amphastar Pharmaceuticals.
 
“We allege that Valvani’s formula for trading success was tapping Johnston to abuse his position of trust as a generic industry representative to the FDA and underhandedly obtain confidential information from his friends and former colleagues at the FDA,” said Andrew J. Ceresney, Director of the SEC’s Division of Enforcement.  “Valvani and his hedge funds made millions by trading on nonpublic FDA drug approval information not available to the rest of the stock market.”
 
The SEC further alleges that Valvani in turn tipped fellow hedge fund manager Christopher Plaford, who is charged in a separate complaint with insider trading on this nonpublic information as well as other material he received confidentially from a former Centers for Medicare and Medicaid Services official about an impending cut to Medicare reimbursement rates for certain home health services.  Plaford allegedly made approximately $300,000 by trading based on inside information in hedge funds he managed.  He has cooperated with the SEC’s investigation.
 
In a separate complaint against Stefan Lumiere, the SEC alleges that he and Plaford engaged in a fraudulent scheme to falsely inflate the value of securities held by a hedge fund advised by their firm.  For an 18-month period, Lumiere used sham broker quotes to mismark as many as 28 securities per month, surreptitiously passing his desired prices along to brokers via his personal cell phone or a flash drive delivered by a courier.  The fund consequently reported artificially inflated returns and monthly net asset values, and paid out more than $5.9 million in inflated management and performance fees to its investment adviser.
 
“Lumiere allegedly used fake prices to value assets while investors were led to believe the fund was using real prices from independent sources that reflected the market value for those assets,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office.  “Financial professionals who cheat investors and game the system should not expect to get away with it.”
 
In parallel actions, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Valvani, Johnston, Lumiere, and Plaford.
 
The SEC’s complaint against Valvani and Johnston charges them with violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.  Valvani also allegedly aided and abetted his firm’s violation of Section 204A of the Investment Advisers Act of 1940. 
 
The SEC’s complaint against Plaford charges him with violations of Section 10(b) of the Exchange Act and Rule 10b-5, and Section 206 of the Advisers Act and Rule 206(4)-8.  He is also charged with aiding and abetting his firm’s violation of Section 204A of the Advisers Act. 
 
The SEC’s complaint against Lumiere charges him with committing or aiding and abetting violations of Section 10(b) of the Exchange Act and Rule 10b-5 as well as Section 206 of the Advisers Act and Rule 206(4)-8. 
 
The SEC’s complaints, filed in federal court in Manhattan, seek disgorgement of ill-gotten gains plus interest and penalties as well as permanent injunctions against future violations.
 
The SEC’s continuing investigation is being conducted by William Conway and Philip Moustakis of the Asset Management Unit and Jason Sunshine, Charles Riely, and Valerie Szczepanik of the New York office.  Assisting the investigation are Brian Fitzpatrick, Neil Hendelman, and Christopher Mele.  The litigation will be led by Alexander Vasilescu, Mr. Moustakis and Mr. Sunshine.  The case is being supervised by Sanjay Wadhwa.  The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York, the Federal Bureau of Investigation, the Department of Health and Human Services Office of Inspector General, and the Financial Industry Regulatory Authority.
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Hong Kong's Securities And Futures Commission Reprimands And Fines Schroder Investment Management (Hong Kong) Limited $1.8 Million For Disclosure Failures

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The Securities and Futures Commission (SFC) has reprimanded and fined Schroder Investment Management (Hong Kong) Limited (Schroder) $1.8 million for failing to disclose all notifiable interests in Hong Kong listed shares (Note 1).

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ESMA Publishes Annual Report 2015

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The European Securities and Markets Authority (ESMA) has published today its Annual Report for 2015, which describes the key accomplishments by ESMA in 2015.

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Reuters Releases Reuters TV 2.0, Introducing New Featured Programs And Adding Live Feeds To Desktop And Apple TV Platforms

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Today Reuters, the world’s largest international multimedia news provider, released version 2.0 of Reuters TV. This new version of the revolutionary connected TV service introduces Featured Programs – thematic programs curated and hosted by Reuters journalists – alongside live feeds of global events and personalized video newscasts. The update includes a major redesign on both Apple TV and the Web that seeks to set the standard for premium online video delivery. Reuters TV is available for iOS and tvOS devices on the Apple App Store, Android devices via Google Play, and on the web globally at Reuters.tv.

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Irish Stock Exchange: Draper Esprit Raises â¬102m From IPO On The ESM

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Draper Esprit plc, the venture capital investor involved in the creation, funding and development of high-growth technology businesses has raised €102m from its Initial Public Offering (IPO) on both the Irish Stock Exchange (ISE) and the London Stock Exchange.

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Bats ETF Marketplace Welcomes iShares MSCI China A ETF - Becomes 42nd iShares Product Listed On Bats

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Bats Global Markets, Inc. (Bats: BATS), the #1 U.S. market for exchange-traded fund (ETF) trading, today welcomed the iShares MSCI China A ETF (Bats: CNYA), which began trading today on the Bats ETF Marketplace.

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High-Growth Potential Of EU SMEs Shines Through In London Stock Exchange Groupâs â1000 Companies To Inspire Europeâ Report

UK's Financial Conduct Authority Signs The Women In Finance Charter

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We are proud to have signed the Women in Finance Charter. We have a strong gender profile and believe that a diverse workforce makes us a better regulator and a great place to work.

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Federal Reserve Board And Federal Open Market Committee Release Economic Projections From The June 14-15 FOMC Meeting

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The attached table and charts released on Wednesday summarize the economic projections and the target federal funds rate projections made by Federal Open Market Committee participants for the June 14-15 meeting.

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Updated Coefficients For Moscow Exchange Indices To Come Into Force

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The following coefficients for Moscow Exchange indices come into force from June 16:

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Federal Reserve Issues FOMC Statement

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Information received since the Federal Open Market Committee met in April indicates that the pace of improvement in the labor market has slowed while growth in economic activity appears to have picked up. Although the unemployment rate has declined, job gains have diminished. Growth in household spending has strengthened. Since the beginning of the year, the housing sector has continued to improve and the drag from net exports appears to have lessened, but business fixed investment has been soft. Inflation has continued to run below the Committee's 2 percent longer-run objective, partly reflecting earlier declines in energy prices and in prices of non-energy imports. Market-based measures of inflation compensation declined; most survey-based measures of longer-term inflation expectations are little changed, on balance, in recent months.

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The FESE General Assembly Approves Budapest Stock Exchange As Full Member And New Board Members

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On 15th June 2016 the General Assembly of the Federation of European Securities Exchanges (FESE) unanimously approved the application of Budapest Stock Exchange to become a Full Member. The Membership will commence as of 1st July 2016.

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The MiG Report - TSX - TSX Venture Exchange

The multiplex dependency structure of financial markets. (arXiv:1606.04872v1 [physics.soc-ph])

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We propose here a multiplex network approach to investigate simultaneously different types of dependency in complex data sets. In particular, we consider multiplex networks made of four layers corresponding respectively to linear, non-linear, tail, and partial correlations among a set of financial time series. We construct the sparse graph on each layer using a standard network filtering procedure, and we then analyse the structural properties of the obtained multiplex networks. The study of the time evolution of the multiplex constructed from financial data uncovers important changes in intrinsically multiplex properties of the network, and such changes are associated with periods of financial stress. We observe that some features are unique to the multiplex structure and would not be visible otherwise by the separate analysis of the single-layer networks corresponding to each dependency measure.

Note on level r consensus. (arXiv:1606.04816v1 [q-fin.EC])

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We show that the hierarchy of level $r$ consensus partially collapses. In particular, any profile $\pi\in \mathcal{P}$ that exhibits consensus of level $(K-1)!$ around $\succ_0$ in fact exhibits consensus of level $1$ around $\succ_0$.


Kinetic and mean field description of Gibrat's law. (arXiv:1606.04796v1 [q-fin.GN])

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We introduce and analyze a linear kinetic model that describes the evolution of the probability density of the number of firms in a society, in which the microscopic rate of change obeys to the so-called law of proportional effect proposed by Gibrat. Despite its apparent simplicity, the possible mean field limits of the kinetic model are varied. In some cases, the asymptotic limit can be described by a first-order partial differential equation. In other cases, the mean field equation is a linear diffusion with a non constant diffusion coefficient that models also the geometric Brownian motion and can be studied analytically. In this case, it is shown that the large-time behavior of the solution is represented, for a large class of initial data, by a lognormal distribution with constant mean value and variance increasing exponentially in time at a precise rate. The relationship between the kinetic and the diffusion models allow to introduce an easy-to- implement expression for computing the Fourier transform of the lognormal distribution.

Local Operators in Kinetic Wealth Distribution. (arXiv:1606.04790v1 [q-fin.GN])

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The statistical mechanics approach to wealth distribution is based on the conservative kinetic multi-agent model for money exchange, where the local interaction rule between the agents is analogous to the elastic particle scattering process. Here, we discuss the role of a class of conservative local operators, and we show that, depending on the values of their parameters, they can be used to generate all the relevant distributions. We also show numerically that in order to generate the power-law tail an heterogeneous risk aversion model is required. By changing the parameters of these operators one can also fine tune the resulting distributions in order to provide support for the emergence of a more egalitarian wealth distribution.

Projektmanagement fur Dummies

101 Ways To Save Money On Your Tax - Legally 2016-2017

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101 Ways to Save Money on Your TaxLegally! is the Australian taxpayer's essential guide to maximising returns. Comprehensively updated for 2016-2017, this indispensable resource explains all of the changes to the May 2016 budget to help you pay what you owe and not a penny more. You'll find answers to common questions, tax traps to avoid and plenty of tips from Mr. Taxman himself

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