Former-Jefferies hedge fund manager found guilty of insider dealing

8 October 2010

An ex-hedge fund manager at Jefferies who earned $7 million in illicit profits has been found guilty of committing securities fraud as part of an insider trading ring.

Joseph Contorinis was convicted on seven counts of securities fraud and one count of conspiracy to commit securities fraud by a court in New York.

He is one of several finance professionals to have been charged of using tips provided by UBS mergers and acquisitions expert Nicos Stephanou to make illegal trades between 2004 and 2006.

Preet Bharara, Manhattan attorney, said: "On top of this office's recent insider trading convictions, today's guilty verdict sends yet another strong message of deterrence to anyone who is thinking about gaming the system like Joseph Contorinis did."

He added that the department will contine its crackdown on insider trading to ensure the “integrity of our financial markets”.

Stephanou, and two other defendants, Michael Koulouroudis and George Paparrizos have already pleaded guilty during the trial.

In the case of Contorinis, the jury required two days to come to a decision after a three-week long trial.

The latter is due to be sentenced in February of next year and could face up to 20 years in prison.

By Jim Ottewill

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