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Hedge Fund Advisers Reach $21.5M SEC Deal

MANHATTAN (CN) - Greenwich, Conn.-based hedge fund advisers Level Global Investors will pay $21.5 million to settle inside-trading charges, the SEC said Monday.

The SEC sued the company and eight other defendants in January 2012, accusing them of "repeated inside trading" in Dell and Nvidia securities.

Defendants included Level Global's co-founder Anthony Chiasson, its former analyst Spyiridon "Sam" Adondakis, five other "investment professionals" and another hedge fund adviser, Diamondback Capital Management.

The SEC claims that Adondakis was a member of "a group of closely associated hedge fund analysts who illegally obtained highly sensitive information regarding the financial performance of Dell and Nvidia before this information was made public."

He passed the information to Chiasson, who used it to make trades for hedge funds managed by Level Global and "reap millions of dollars in illegal profits," the SEC said in a statement announcing the settlement.

Level Global, which once managed $4 billion, is "winding down its business" because of the federal investigation, the SEC said.

"The insider trading at Level Global was hardly an isolated event - it occurred repeatedly, and involved multiple companies and multiple quarterly announcements," a senior official in the SEC's New York Regional Office said in the statement.

Level Global was ordered to disgorge $10,082,725 in ill-gotten gains, pay the same again in penalties, plus $1,348,824 in interest, for a total of $21,514,274.

But as is customary with the SEC, it doesn't have to admit it did it.

Adondakis pleaded guilty to parallel criminal charges, and Chiasson was criminally convicted, the SEC said.

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