01/12/2011 Author: Will Wainewright

HFMWeek Daily Snapshot - 1 December

NEWSPAPERS AND WIRES
Individuals at investment firms Neuberger Berman Group, Level Global Investors and Diamondback Capital Management may face federal criminal charges as part of an ongoing insider trading probe by US authorities in New York, a person familiar with the matter said, reports Bloomberg. The charges may be filed as early as this month, said another person familiar with the probe who also wasn’t authorized to speak because the matter isn’t public.

A Securities and Exchange Commission investigation into insider trading and possible market manipulation by a hedge fund manager was derailed last year because a senior SEC attorney had inappropriate phone and email conversations with the fund manager, according to a report released Wednesday, writes the Wall Street Journal. The abandoned hedge-fund case came to light in SEC Inspector General David Kotz's semi-annual report to Congress. The report summarizes Kotz's investigations between April and September, which hadn't previously been made public.

Former Treasury Secretary Henry Paulson may have given a group of hedge fund managers the insider-trading opportunity of a lifetime three-and-a-half years ago, according to FINAlternatives. On 21 July 2008, at the offices of Eton Park Capital Management, Paulson said that the federal government was considering a "conservatorship" plan for government-backed mortgage lenders Fannie Mae and Freddie Mac. Under such a plan, the lenders' shareholders would be all but wiped out, Paulson told the attendees.

Billionaire hedge fund manager John Paulson is reported to have taken the unusual step of promising to cover any losses of a prestigious New York cultural institution that has invested with him, writes the Telegraph, citing the New York Times. Paulson will protect the 92nd Street Y against losses from its investment in Paulson & Co's funds, a move which could see Paulson owing the institution about $4m (£2.5m). The 92nd Street Y, where Paulson is a board member, has been one of New York's best-known cultural, educational and community centres since it was founded in 1874.

LAUNCHES
Deutsche Bank has teamed with Omega Advisors to launch a Ucits-compliant long/short equity hedge fund on its dbalternatives platform, according to Citywire. The fund, which is called DB Platinum Omega and is due to be launched officially in December, will be managed by billionaire hedge fund veteran Leon Cooperman, who is chair and chief executive officer of Omega. Cooperman currently runs the Omega Overseas Partners and the Platinum fund is expected to echo its long-biased long-short equity strategy, which mainly invests in US mid and large-cap companies.

PEOPLE MOVES
Barclays Capital has added a hedge fund executive to serve as its Tokyo-based head of global markets, writes FINAlternatives. Nicholas Wright will lead all sales and trading activities in Japan, Barclays said. Wright, who joined the firm last week, has been based in Australia running a portfolio of companies, including an unidentified hedge fund. He formerly worked in Japan at Credit Suisse. "Nicholas' breadth of global experience and proven leadership capabilities will serve to significantly enhance our client offering," Eiji Nakai, CEO of Barclays Capital Japan, said.