A federal appeals court has vacated the insider trading convictions of two former hedge fund managers stemming from trades in Dell and Nvidia.
Todd Newman and Anthony Chiasson were convicted in 2012 of trading on insider information. The U.S. Second Circuit Court of Appeals ruled in part that there was a lack of clear evidence that the two knew the person giving the tip got any benefit from the trades.
CNBC says, it was a major setback for Manhattan U.S. Attorney Preet Bharara. Experts predicted the ruling could have a wide-ranging impact on the future of insider trading cases, and even affect Securities and Exchange Commission enforcement.
"The Government presented no evidence that Newman and Chiasson knew that they were trading on information obtained from insiders in violation of those insiders' fiduciary duties," Judge Barrington Parker wrote in the filing.
"Today's decision is a resounding victory for the rule of law and for Anthony Chiasson personally," Chiasson's lawyer Gregory Morvillo said in a statement to CNBC. "Mr. Chiasson has always conducted himself according to the highest ethical and professional standards in service to many of the world's leading hedge fund investors who were his clients for years."
But, but, but... They're hedge fund managers - they must be evil!
ReplyDeleteAnyway, "insider trading" might be a tort issue, but making it a criminal issue is just another state over-reach.