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Pequot, Arthur Samberg Charged With Insider Trading

Submitted by Tyler Durden on 05/27/2010 11:17 -0400

From Bloomberg:

Pequot Capital Management Inc. and the hedge-fund firm's founder, Arthur Samberg, will pay almost $28 million to settle regulatory claims they illegally tapped information from a Microsoft Corp. employee to bet on the software maker's stock.

The U.S. Securities and Exchange Commission is also bringing civil claims against the ex-Microsoft worker, David Zilkha, who concealed his actions during an earlier investigation, the agency said in a statement today.

"The cases have two particularly troubling aspects -- a hedge fund manager trading on illegal insider information, and his tipper source who withheld crucial information about the scheme during an SEC investigation," SEC Enforcement Director Robert Khuzami said in the statement. "Both are high-priority targets for SEC Enforcement."

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Thu, 05/27/2010 - 11:18 | 376893 homersimpson

Oh, my virgin eyes.

Fri, 05/28/2010 - 00:43 | 378461 BlackBeard

Of all the stocks...MSFT...

Thu, 05/27/2010 - 11:25 | 376911 infinitewhy

keep it comin', fuckers

Thu, 05/27/2010 - 11:46 | 376920 HarryWanger

WASHINGTON (MarketWatch) -- Pequot Capital Management Inc. and its Chief Executive Arthur Samberg agreed to a $28 million settlement with the Securities and Exchange Commission over charges that the mega-hedge fund engaged in insider trading in Microsoft Corp. securities. according to the SEC on Thursday. "The cases have two particularly troubling aspects - a hedge fund manager trading on illegal insider information, and his tipper source who withheld crucial information about the scheme during an SEC investigation," said Robert Khuzami, director of the SEC's Division of Enforcement.

-Wow, that was fast!

Thu, 05/27/2010 - 12:02 | 376938 Matto

Keep frying up them little'ns SEC

Thu, 05/27/2010 - 12:08 | 376954 williambanzai7

I guess 28 million is what it takes.

Thu, 05/27/2010 - 12:44 | 377077 Divided States ...

Profit 100 mm on insider info and pay a settlement of 28 mm. Pocket the change and do it again. What a nice country this is.

Thu, 05/27/2010 - 15:47 | 377586 williambanzai7

Some government asshole really should get on the phone and explain all of this to Martha Stewart.

It took them nine years to come up with this. Meanwhile they nailed her to the cross before you could say "shit for shinola.".

Thu, 05/27/2010 - 12:19 | 376981 Ethics Gradient

Easily defended!

"Your Honour, the prosecution seems to be suggesting that we gained information, not commonly available, that could allow us to make an unfair profit. This however would require share prices to relate to what's happening in the real world....."

Thu, 05/27/2010 - 12:46 | 377050 time2wakeup

The question here is: Why isn't the SEC investigating and charging itself for it's own past collusion with this very same Pequot Capital Management - for their instrumental roll in permanently quashing Mr. Samberg's blatant insider trading deal with current Morgan Stanley CEO John Mack?

Mack had his "contacts" within the SEC: Linda Thomsen and Chris Cox - fire former SEC investigator Gary Aguirre for having the balls to actually do his job. Why both Cox and Thomsen have not been charges with criminal conspiracy and fraud for their complicity in perpetrating Pequot's long history of insider trading is further testament to the illegitimacy of anything that comes out of this financial industry hack and cesspool agency.

http://www.marketwatch.com/story/sec-denies-politics-interfered-in-pequo...

Thu, 05/27/2010 - 12:42 | 377071 Amish Hacker

Or how about putting Lloyd Blankfein in the dock and asking him how GS didn't have a single losing day last quarter. Answer: you don't need insider information from others when you are the insider, you just need to front run every trade.

Thu, 05/27/2010 - 13:23 | 377191 Grand Supercycle