Whittier Manager Settles Inside Trading Case

     (CN) – Whittier Trust Co. and fund manager Victor Dosti agreed to pay nearly $1.7 million to settle charges of inside trading, the SEC said Friday.
     The agency claims Dosti and Whittier Trust reaped profits and avoided losses of more than $700,000 trading on inside tips about Dell, Nvidia Corp. and Wind River Systems in 2008, 2009 and 2010.
     Dosti received “material nonpublic information” from junior colleague Danny Kuo, who was tipped off by insiders such as former Diamondback Capital Management adviser Jesse Tortora, according to the SEC’s federal lawsuit in Manhattan.
     Tortora received his information from Dell employee Sandeep Goyal, who was charged last year with inside trading by the SEC.
     The agency also charged Kuo in a separate federal complaint last year, and he is now cooperating with the investigation, the SEC said in a statement.
     “Time and again, Dosti received what he knew was inside information from Kuo and traded on it to generate illicit gains for the funds he managed,” said Sanjay Wadhwa, senior associate director of the SEC’s New York Regional Office. “Now, he and Whittier Trust join a long list of insider trading perpetrators who have been held accountable by the SEC for their transgressions.”
      Without admitting any wrongdoing, Whittier Trust and Dosti agreed to disgorge nearly $800,000 combined and pay a penalty of the same amount, plus prejudgment interest of about $78,000.
     The settlements are subject to court approval.          
     The SEC has charged more than three dozen people and firms in its investigation of “widespread insider trading at several hedge funds and other investment advisory firms,” according to a press release.
     The first series of charges were brought in 2011 against six expert network consultants and employees.

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