WEST PALM BEACH, FL (www.hedgeco.net) – The Securities and Exchange Commission {SEC} has charged Guillaume Pollet, a former managing director of SG Cowen & Co., with insider trading and fraud.According to the charges, Mir Pollet was involved with short-selling of stocks of companies prior to the companies closing on a private offering, including offerings in the companies in which SGCowen have invested in. Mr. Pollet�s duties in SG Cowen involve making proprietary funds investments in PIPE transactions.
The Commission’s complaint was filed in the United States District Court for the Eastern District of New York. The complaint alleges �that during 2001 Pollet traded in the shares of ten public companies that either engaged in, or were contemplating engaging in, PIPE financings after receiving confidential non-public information about the upcoming PIPE transaction.�
The complaint alleges further that Mr. Pollet occasionally sold short some publicly traded securities of PIPE transactions so as to lock in gains for the SG Cowen�s Proprietary account. Pollet�s firm has allegedly profited to the tune of $4 million according to the SEC complaint.
Director of the Commission’s Northeast Regional Office, Mr. Mark K. Schonfeld said, �While PIPE transactions may help a company meet its financing needs, they also create opportunities for fraud. This case sends the message that we will actively patrol this area so that issuers and investors alike can have confidence in these financing vehicles.”
The Associate Regional Director of the Commission’s Northeast Regional Office, David Rosenfeld said, �Individuals who receive confidential information about important financing transactions must refrain from trading based on that information. This case was particularly egregious because there were specific representations made to the PIPE issuers that SG Cowen would not or had not engaged in short selling prior to the close of the transaction.” The SEC is �seeking injunctive relief, disgorgement of all ill-gotten gains plus pre-judgment interest, and civil penalties.”
Paul Oranika
Editor-in-Chief
HedgeCo.Net
Email: Editor@hedgeco.net
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