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- Sarah ten Siethoff is New Associate Director of SEC Investment Management Rulemaking Office
- Catherine Keating Appointed CEO of BNY Mellon Wealth Management
- Credit Suisse to Pay $47Mn to Resolve DOJ Asia Probe
- SEC Chair Clayton Goes 'Hat in Hand' Before Congress on 2019 Budget Request
- SEC's Opening Remarks to the Elder Justice Coordinating Council
- Massachusetts Jury Convicts CA Attorney of Securities Fraud
- Deutsche Bank Says 3 Senior Investment Bankers to Leave Firm
- World’s Biggest Hedge Fund Reportedly ‘Bearish On Financial Assets’
- SEC Fines Constant Contact, Popular Email Marketer, for Overstating Subscriber Numbers
- SocGen Agrees to Pay $1.3 Billion to End Libya, Libor Probes
- Cryptocurrency Exchange Bitfinex Briefly Halts Trading After Cyber Attack
- SEC Names Valerie Szczepanik Senior Advisor for Digital Assets and Innovation
- SEC Modernizes Delivery of Fund Reports, Seeks Public Feedback on Improving Fund Disclosure
- NYSE Says SEC Plan to Limit Exchange Rebates Would Hurt Investors
- Deutsche Bank faces another challenge with Fed stress test
- Former JPMorgan Broker Files racial discrimination suit against company
- $3.3Mn Winning Bid for Lunch with Warren Buffett
- Julie Erhardt is SEC's New Acting Chief Risk Officer
- Chyhe Becker is SEC's New Acting Chief Economist, Acting Director of Economic and Risk Analysis Division
- Getting a Handle on Virtual Currencies - FINRA
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NEWSLETTERS & ALERTS
SEC Foils Insider Trading Scheme Involving Confidential Government Info
The SEC announced charges against 4 individuals in an alleged insider trading scheme involving tips of nonpublic information about government plans to cut Medicare reimbursement rates, which affected the stock prices of certain publicly traded medical providers or suppliers. In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced related criminal charges.
Named in the SEC complaint were: [see below for more complete profiles]
- David Blaszczak, a former government employee, who now runs Precipio Health Strategies, a consulting firm he founded.
- Christopher Worrall, a health insurance specialist in the government’s Center for Medicare Services (‘CMS’).
- Ted Huber, a Partner on the Private Transactions team at Deerfield, a hedge fund advisory firm.
- Jordan Fogel, a former Partner at Deerfield, who now runs Elinem Management, a firm he founded.
A fifth individual was named in the federal indictment that was unsealed today in a Manhattan courtroom: Rob Olan. a Partner at the Deerfield hedge fund.
ACCORDING TO THE SEC COMPLAINT, … David Blaszczak obtained key confidential details about upcoming decisions by the CMS from his close friend and former colleague at the agency, Christopher Worrall. Worrall tipped Blaszczak about at least 3 pending CMS decisions that affected the amount of money companies would receive from Medicare for services or products related to cancer treatments or kidney dialysis.
Blaszczak, in turn, tipped 2 partners - Theodore Huber and Jordan Fogel - at Deerfield, that paid him as a consultant. Huber and Fogel used that information to recommend that the firm trade in the stocks of 4 health care companies whose stock prices would likely be affected by the decisions once CMS announced them publicly. Those trades netted more than $3.9 million in illicit profits.
For his tips, Blaszczak’s firms were paid at least $193,000 in a 19-month period by the hedge fund where the analysts worked.
Prosecutors said the scheme ran from 2012 to 2014. The SEC, which seeks disgorgement of ill-gotten gains plus interest and penalties, is continuing its investigation.
DAVID BLASZCZAK. According to his LinkedIn profile, Blaszczak is partner of Precipio Health Strategies, which he founded in 2013. Prior to that, he was with: (i) Potomac Research Group, Washing Research Group, and CMS (2000-2005).
CHRISTOPHER WORRAL. A health insurance specialist in the government’s Center for Medicare Services, where the leaks allegedly originated.
TED HUBER. According to his profile on the Deerfield website, Huber is a partner on the Private Transactions team at Deerfield, which he joined in 2005. He provides extensive research and analysis on individual companies operating in the healthcare industry. Prior to joining Deerfield, he was with: (i) Wachovia Securities; and (ii) medical technology company Nellcor.
JORDAN FOGEL. According to his LinkedIn profile, Fogel is a portfolio manager with Elinem, a firm he founded in 2016. Prior to that, he was with: (i) Deerfield (2006-2016); (ii) Credit Suisse; and, (iii) ASCOA.
ROB OLAN. According to his profile on the Deerfield website, Olan is a partner on the Devices team at Deerfield which he joined in 2002, He provides extensive research and analysis on individual companies operating in the healthcare industry. Prior to that, he was with: (i) JPMorgan; and, (ii) Hambrecht & Quist.