Some of the country’s largest hedge funds are being investigated by the SEC as part of an insider-trading probe, court documents filed by the agency in U.S. District Court in New York late Wednesday show.
Securities and Exchange Commission officials are investigating staff members of the House Ways and Means Committee for their role in possible insider trading during a change in federal health-care policy that led to share price increases in several health insurers.
In the filing, Sanjay Wadhwa, SEC senior associate regional director for the New York region, said the investigation “is substantially concerned with the investor clients of Height Securities … who may have engaged in relevant trading.” The investor clients include 44 hedge funds and others “including some of the largest hedge funds and asset management advisers in the nation,” Mr. Wadhwa said in the filing. Of the 44 hedge funds, 25 are based in New York, one in Washington, and the others in California, Connecticut, Illinois and Massachusetts, among other states.
The SEC in 2013 issued subpoenas to firms and people connected to possibly leaked information about federal health-care funding, including Ways and Means Committee staff members. The committee is seeking to have the case dismissed or moved to the District of Columbia.