The U.S. Securities and Exchange Commission sued Trivium Capital Management LLC and an executive of Polycom Inc. in a case stemming from the government's Galleon Group LLC insider-trading investigation.
The U.S. Securities and Exchange Commission sued Trivium Capital Management LLC and an executive of Polycom Inc. in a case stemming from the government’s Galleon Group LLC insider-trading investigation.
Regulators allege that Trivium co-founder Robert Feinblatt, 41, and Jeffrey Yokuty, 37, an analyst at the New York-based hedge fund adviser, were given inside tips about Blackstone Group’s impending purchase of Hilton Hotels Corp. and traded on behalf of Trivium based on the information.
The SEC also alleges that Sunil K. Bhalla, former senior vice president of Polycom, a Pleasanton, California-based producer of networking applications, tipped information that helped Feinblatt and Yokuty make illicit profits of more than $15 million on behalf of Trivium’s hedge funds, according to an SEC statement.
“Today’s action reveals disturbingly corrupt arrangements -- faithless company executives who secretly pass corporate information to hedge fund managers willing to violate the law for profit,” said Robert Khuzami, director of the SEC’s Division of Enforcement.
The SEC says that to date, it has brought enforcement actions against 27 defendants involving insider trading at numerous hedge funds, including Galleon Group.
The complaint says that Feinblatt and Yokuty allegedly received material nonpublic information from Roomy Khan, a former Intel Corp. executive who pleaded guilty in the Galleon Group criminal case and is cooperating with the government’s continuing probe.
Lawyers for the defendants couldn’t be immediately reached for comment.
Bloomberg