FBI agents today raided the offices of 3 three hedge funds - Level Global Investors, Diamondback Capital and Loch Capital Management - as part of the federal government's vast probe into insider trading.  The raid was carried out with court-authorized search warrants.  The sweep of the 3 firms’ offices follows Saturday's WSJournal story about broad-based investigations across Wall Street and across the United Start that seek to identify pipelines offering nonpublic information to traders and other investors - from hedge funds and mutual funds, to Goldman Sachs.

A spokesman for Level Global, confirmed that a search was being conducting at the hedge fund’s offices in Connecticut.   Level Global and Diamondback reportedly have ties to giant hedge fund SAC Capital - run by Steven A. Cohen;  Level Global is run by David Ganek, a protégé of Mr. Cohen’s who left to found his own firm in 2003.  Diamondback was founded in 2005 by three SAC alumni: Larry Sapansky, Chad Loweth and Rich Schimel.

Loch Capital is a technology focused hedge fund based in Boston. In January, Reuters reported that Loch had been roiled by ties between the firm’s founders — brothers Timothy and Todd McSweeney — and Steven Fortuna, a co-founder of the hedge fund S2 Capital Management, a crucial witness in the Galleon hedge fund investigation.  [NYT Dealbook, 11/22]

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