The following snaps flashed up on Reuters on Friday:
RTRS-U.S. SEC ENFORCEMENT CHIEF KHUZAMI SAYS SEEING SIGNIFICANT EXPANSION AS TO WHERE GALLEON/HEDGE FUND PROBE IS LEADING
16:48 06Nov09 RTRS-KHUZAMI SAYS SOME HEDGE FUND BUSINESS MODELS,
US prosecutors on Thursday intensified their crackdown on Wall Street insider trading, revealing criminal charges against 14 people which are related to the case last month against Raj Rajaratnam, founder of the Galleon hedge fund,
Redemptions from institutional investors have continued to drain capital from Man Group, the world’s largest listed hedge fund manager, over the past seven months. However, the group’s first-half results showed outflows from institutions were partially offset by surging investment from Asia and the Middle East.
Some 21 individuals and firms are now facing — or have faced — court action stemming out of the investigation into an alleged $20m insider trading ring.
Here’s the re-re-revised complaint from the SEC with details on the sprawling investigation. Get yourself a coffee or something - it’s 50 pages long.
The complaint documents associated with the latest swoop on those allegedly dealing inside make it abundantly clear the FBI has made very extensive use of co-operating witnesses.
In particular, there is bound to be speculation on the identity of someone referred to as “CS-1,”
In the aftermath of the a fresh series of arrests against individuals allegedly involved in a $20m insider trading ring, the SEC released details of an amended complaint on Thursday.
Those featured in the complaint are a motley crew of hedgies,
Early in New York on Thursday morning, CNBC reported that seven people had been arrested in what was described only as “an ongoing insider trading case related to hedge funds.”
It has since become clear that the arrests are linked to the allegations against Raj Rajaratnam and the Galleon hedge fund.
Just about “everyone and their uncle” seems to be shorting Japanese government bonds at the moment, notes Louis-Vincent Gave in the latest note from the asset allocation and research house Gavekal.
Friends on trading desks call it the “Einhorn Effect”,
Elsewhere on Wednesday,
- If the economy’s stagnant, why are stocks up?
- The edge: a golden opportunity remains.
- On the clash of economic theories (and commentators).
- John Paulson once had self-doubts.
When investor David Downey decided in May 2008 that he wanted to do other things with the $110,000 he invested, he says he received several e-mails from his SP Trader contact, Ben Weiss. Each time, he claims that Weiss gave him a date by which he could expect his money,
The recent revival of hedge fund start-ups has sent the clearest signals yet of a rebound in the $1,400bn global hedge fund industry. UK-based Tyrus Capital on Monday became the largest fund to launch so far this year,
Hector Ruiz, chairman of Globalfoundries, the chipmaker, has become the highest-profile executive to step down in the aftermath of the Galleon insider trading allegations. The former CEO of Advanced Micro Devices is taking immediate voluntary leave,
Elsewhere on Monday, and on the weekend,
- More Goldman - how it secretly bet on the US housing crash.
- Roubini on dollar carry reversal - “he’s only halfway there”.
- Can Citigroup Carry Its Own Weight?
- It’s Japan we should be worrying about.
Tyrus Capital, the hedge fund set to be launched on Monday by former Deephaven manager Tony Chedraoui, has raised more than $800m from investors in one of the clearest signs to date of renewed confidence in the hedge fund industry.
Elsewhere on Friday,
- Bernanke’s modern encapsulation of Friedman’s bold revelation.
- The story behind WaMu’s demise.
- ‘David Rosenberg makes Nouriel Roubini look like Mary Poppins’.
- If you want to rein in bankers’ pay,
The trans-Atlantic investigation into the K1 hedge fund group escalated on Thursday when its founder was arrested in Germany and US authorities revealed a money-laundering probe that is reportedly connected with the European inquiry.
Concerns about the business practices of Galleon hedge fund founder Raj Rajaratnam and his associates were raised inside JPMorgan Chase as far back as 2001, according to internal memos seen by the FT. Rajaratnam,
Citadel Investment Group told investors it would fully lift its 10-month ban on withdrawals from the hedge-fund firm, and also confirmed on Thursday that a banker it hired last year to build an investment bank,
From Reuters on Thursday afternoon:RTRS-GERMAN ARREST WARRANT FOR K1 HEDGE FUND’S KIENER SAYS BARCLAYS PUT NEARLY $220 MLN INTO FUND, MOST OF WHICH APPEARS LOST
RTRS-ARREST WARRANT SAYS BNP PARIBAS INVESTED AROUND $60 MLN WITH K1 BETWEEN APRIL 2007 AND JUNE 2008
FRANKFURT,
Gold bugs of the world, unite! You have nothing to lose but your exposure to fiat currencies.
Or so says leading hedgie and Wall Street throw back Paul Tudor Jones, who in his latest missive to investors has gone soft at the knees for the yellow metal:
We seem to be having some - err, emotional “hedge fund moments” this week.
On the maudlin side, Todd Harrison at MarketWatch recalls his earlier career on Wall Street in a sad dirge to a once-mighty industry:
Elsewhere on Thursday,
- William J Bernstein’s Investor’s Manifesto, black swans, poker…
- Bloomberg kills its most popular feature.
- Back to the VC future: small as the new big.
- Bond bears:
The Galleon hedge fund at the centre of an insider trading scandal paid hundreds of millions of dollars a year to its Wall Street banks and in return regularly received market information that would not have been disclosed to most investors.
The US court-appointed trustee in charge of recovering assets from Bernard Madoff’s fraudulent investment operations said on Wednesday $21.2bn had been lost through his Ponzi scheme, far higher than thought.
German prosecutors revealed on Wednesday they are investigating possible fraud and breach of duty by Helmut Kiener, founder of a hedge fund group known as K1, reports the FT. The move came after Bloomberg had earlier reported that authorities in Europe and the US were investigating whether some banks had been deceived in dealings with K1,
Go figure:
. . .
. . .Ah but wait, this looks more familiar:
. . .
UPDATE: 17:05
Any further questions about the K1 miracle funds can be answered by this highly comprehensive yet short explainer:
The former head of JPMorgan’s credit proprietary trading desk and a team of senior traders from the bank have set up a new London-based hedge fund to invest in the debt of troubled European and UK companies.
So, it wasn’t just an afterthought. The SEC has clearly woken up to the possible unfair advantages enjoyed by those practising the art of high frequency trading.
Alternative trading systems, co-location services,
Okay, okay, that’s just a lame little joke.
Call ‘em what you will — stoolies, narks, informer, a grass, co-operative witnesses. Either way, FT Alphaville does not condone illegal activity in any form.
We might have expected David Einhorn’s Greenlight Capital to have suffered terribly during the recent equity rally.
But no! Mr Einhorn might scold the Obama administration for pursuing “short-term popularity over our solvency”
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