Connecticut funds Diamondback Capital Management LLC and Level Global Investors LP, and Loch Capital Management, of Boston, in charge of over $10B in assets were raided today as part of an investigation of insider trading.
The raids come as federal prosecutors prepare to unveil a series of new insider trading cases against hedge fund traders, consultants and Wall Street bankers, several lawyers familiar with the investigation said.
This is on top of what prosecutors have described as the largest U.S. hedge fund insider trading case ever. That case is centered on Raj Rajaratnam’s hedge fund Galleon Group, and has led to criminal or civil charges against at least 23 people since being announced just over one year ago.
“The Justice Department promised a more muscular approach to white-collar crime, and is delivering,” said Eugene O’Donnell, a professor at the City University of New York’s John Jay College of Criminal Justice.
