Start Diamondback capital liquidating

Diamondback capital liquidating

What’s more, Schimel was married to Cohen’s sister. w=1024" class="size-full wp-image-1770032" src="https://fortunedotcom.files.wordpress.com/2016/08/ins09_c.jpg? w=1024&h=711" alt="Preet Bharara, US Attorney for the South" width="1024" height="711" srcset="https://fortunedotcom.files.wordpress.com/2016/08/ins09_c.jpg?

The phone call that changed Todd Newman’s life came without warning. Newman was at his desk at Diamondback Capital Management, a hedge fund based in Stamford, Conn.

He had arrived 15 minutes earlier at the firm’s office in One Landmark Square—coincidentally, a building Newman’s grandfather had developed years earlier—after commuting that morning from his home outside Boston, where he lived with his wife and daughter. He ran a long/short book of about $150 million, trading mostly in the stocks of technology companies.

Bharara and his team treated Newman like a high-value target from the beginning.

In fact, they broke new ground in building the case against him.

When the Supreme Court declined to hear the government’s appeal last fall, Newman was a free man—but one with a very different perspective on the authorities who regulate his industry.

The reversal of Newman’s conviction was a major setback for Bharara, Wall Street’s top cop, who had successfully prosecuted more than 80 insider-­trading cases since 2009.

(SAC would eventually, in 2013, agree to plead guilty to insider trading and to pay a massive $1.8 billion settlement, but Cohen himself was not prosecuted.) Moreover, there were signs that something big was about to go down. CLARY/AFP/Getty Images) " data-medium-file="https://fortunedotcom.files.wordpress.com/2016/08/ins09_c.jpg? “We’re at the Mc Donald’s around the corner,” Makol said.

Just two days before Newman received the call from Makol, the Wall Street Journal had published a long article, under the headline “U. in Vast Insider Trading Probe,” that detailed a three-year, Bharara-led investigation that was about to “ensnare consultants, investment bankers, hedge-fund and mutual-fund traders, and analysts across the nation.” One focus was so-called expert networks, and specifically a company, Primary Global Research, which reportedly connected experts in a variety of industries—particularly health care and technology—with investors looking for information. Preet Bharara, US Attorney for the Southern District of New York, speaks at a press conference on January 18, 2012 in New York to announce charges against seven investment professionals who participated in an insider trading scheme that allegedly netted more than 61.8 million USD in illegal profits based on trades of a single stock. “We want to talk to you.” “What do you want to talk about? “If you come down, we’ll talk about it,” Makol replied. He asked Makol how long he would be at the Mc Donald’s. If not, whatever.” After hanging up, Newman went to see Diamondback’s general counsel, and together they spoke to the chief operating officer, as well as with the firm’s outside counsel at Wilmer Hale.

About an hour after Makol’s call to Newman, Reed Brodsky, an assistant U. Attorney working for Bharara who had been the lead prosecutor on the Rajaratnam case, spoke to Pavlis.

Newman recalls that Brodsky told Pavlis he would like to speak with Newman because “we have him” on tape hearing “possible gray stuff” about corporate earnings and that he was trading on inside information about possible mergers and acquisitions.

After enduring months of uncertainty, he would be charged officially with insider trading and, in December 2012, convicted of the crime.