Skip to main content
MENU
Subscribe
  • Sign Up Free
  • LOGIN
  • Subscribe
  • Topics
    • Alternatives
    • Consultants
    • Coronavirus
    • Courts
    • Defined Contribution
    • ESG
    • ETFs
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Opinion
    • Partner Content
    • Pension Funds
    • Private Equity
    • Real Estate
    • Russia-Ukraine War
    • SECURE 2.0
    • Special Reports
    • White Papers
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Eddy Awards
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • Climate Change: The Inescapable Opportunity
    • Impact Investing
    • 2022 ESG Investing Conference
    • ESG Rated ETFs
  • Defined Contribution
    • Latest DC News
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • Trends in DC: Focus on Retirement Income
    • 2022 Defined Contribution East Conference
    • 2022 DC Investment Lineup Conference
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Performance Data
    • P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
    • Future of Investments Research Series
    • Charts & Infographics
    • Polls
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
    • 2023 Defined Contribution East
    • 2023 ESG Investing
Breadcrumb
  1. Home
  2. COURTS
June 15, 2016 01:00 AM

Visium's Valvani among 4 facing U.S. fraud charges

Bloomberg
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    Money managers at Jacob Gottlieb's Visium Asset Management hedge fund face federal charges that include trading on illegal tips from a former official at the Food and Drug Administration.

    Visium is the biggest hedge fund to have employees linked to criminal wrongdoing since the government set its sights on firms including Galleon Group and S.A.C. Capital Advisors. Both firms were forced to shut their doors after traders and executives were accused of widespread insider trading. Visium is not accused of wrongdoing.

    In one case unsealed Wednesday, Visium's Sanjay Valvani is accused of trading on tips about drugs that were seeking generic status from the FDA, according to federal prosecutors in New York. As part of its case, the government has won a guilty plea from the former senior FDA official, Gordon Johnston, who worked as a consultant to Visium from 2005 to 2011 and allegedly passed tips to the fund from an FDA insider.

    In another case, Christopher Plaford and Stefan Lumiere, two former Visium employees, are accused of allegedly mismarking securities. Mr. Plaford has pleaded guilty, and charges against Mr. Lumiere were unsealed Wednesday. Mr. Lumiere didn't immediately respond to requests for comment.

    “Sanjay Valvani is an innocent man whose investment decisions were always based on rigorous and entirely appropriate research and analysis, consistent with his high integrity,” his lawyer, Barry Berke, said in a statement. “It will be shown that the prosecution of Mr. Valvani is yet another example of this United States attorney's office stretching the facts and law to try to transform entirely innocent trading decisions into a crime.”

    The four were also sued by the Securities and Exchange Commission. Jonathan Gasthalter, a spokesman for Visium, didn't immediately respond to requests for comment.

    Mr. Gottlieb told investors in March that the firm is under investigation by the Justice Department and the SEC. Mr. Gottlieb, a medical school graduate who later turned to a career in finance, founded Visium in 2005 and expanded it beyond its roots in trading equities tied to the health-care industry. The firm manages about $8 billion today and employs more than 170 people in New York, London, and San Francisco.

    According to the indictment, Mr. Valvani directed Mr. Johnston to get information about the approval status of a generic form of the drug enoxaparin from a former FDA colleague. Mr. Valvani used the FDA information to trade in the stock of two drug companies, for a $25 million profit. Mr. Valvani passed the information to Mr. Plaford, who also traded on it, according to prosecutors.

    “FDA, by policy, does not comment on potential or ongoing investigations,” Christopher Kelly, a spokesman for the FDA, said in an e-mail.

    The FDA insider was unaware of how the information was going to be used, authorities said.

    Prosecutors claim that from June 2011 to September 2013, Messrs. Plaford and Lumiere misstated the value of a fixed-income fund managed by Mr. Plaford by inflating its net asset value and overstating its liquidity. Mr. Lumiere surrendered to authorities Wednesday.

    Related Articles
    SEC charges Atlantic Asset Management with fraud
    SEC to refund Level Global Investors after overturned insider-trading charge
    Former State Street executive charged by SEC related to transition management f…
    AllianceBernstein to take over management of Visium Global Fund
    Visium to sell, close all of its hedge fund strategies
    Visium's Valvani found dead in apparent suicide amid insider-trading charges
    17 Visium portfolio managers hired for new Citadel strategy
    Supreme Court reconsiders insider-trading law
    Supreme Court upholds long-standing insider-trading precedent
    Platinum Partners executives arrested for alleged securities fraud
    Ex-Visium manager found guilty of fraud in about 90 minutes
    Recommended for You
    courtroom gavel books 1550_i.jpg
    ERISA lawsuit against Olin Corp. dismissed again
    ONLINE_180629880_AR_0_EJBZKXTYSLGZ.jpg
    Judge throws out most ERISA violation allegations against Schneider Electric Holdings
    University_of_Southern_California_i.jpg
    University of Southern California settles 6-year-old ERISA lawsuit, avoiding trial
    The Institutional Investor's Guide to ESG Investing
    Sponsored Content: The Institutional Investor's Guide to ESG Investing

    Reader Poll

    January 25, 2023
    SEE MORE POLLS >
    Sponsored
    White Papers
    Show Me the Income: Discovering plan sponsor and participant preferences for cr…
    The Future of Infrastructure: Building a Better Tomorrow
    Fulcrum Issues: Equity Returns and Inflation — Choose Your Own Adventure
    What Matters Most in Considering a Private Debt Strategy
    Why pursue direct lending in the core middle market?
    Research for Institutional Money Management
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    December 12, 2022 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Content Solutions
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Consultants
      • Coronavirus
      • Courts
      • Defined Contribution
      • ESG
      • ETFs
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Opinion
      • Partner Content
      • Pension Funds
      • Private Equity
      • Real Estate
      • Russia-Ukraine War
      • SECURE 2.0
      • Special Reports
      • White Papers
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Eddy Awards
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • Climate Change: The Inescapable Opportunity
      • Impact Investing
      • 2022 ESG Investing Conference
      • ESG Rated ETFs
    • Defined Contribution
      • Latest DC News
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • Trends in DC: Focus on Retirement Income
      • 2022 Defined Contribution East Conference
      • 2022 DC Investment Lineup Conference
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Performance Data
      • P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
      • Future of Investments Research Series
      • Charts & Infographics
      • Polls
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
      • 2023 Defined Contribution East
      • 2023 ESG Investing