Former NY hedge fund employee pleads guilty to insider trading

February 3rd, 2010 - 2:26 am ICT by BNO News  

NEW YORK CITY (BNO NEWS) – A former hedge fund employee on Tuesday pleaded guilty in a federal court to insider trading charges, prosecutors said.

David Slaine, 50, a former employee of a Hedge Fund called Chelsey Capital (“Chelsey”), participated in an insider trading scheme that, according to evidence, resulted in over $3 million in profits to Chelsey. Slaine previously pleaded guilty in December 2009 to conspiracy and securities fraud charges arising from the insider trading scheme.

Between February and December 2002, Slaine worked for Chelsey, where he participated in trading equity securities on behalf of Chelsey. During that time, another Chelsey employee, Eric Franklin, was obtaining material, nonpublic information regarding upcoming upgrades and downgrades in UBS analysts’ securities recommendations.

In addition, Slaine used the UBS inside information to execute profitable securities transactions in his personal brokerage account.

Slaine faces a maximum sentence of 25 years imprisonment.

The case is a result of an investigation by the Federal Bureau of Investigation and the United States Securities and Exchange Commission.

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