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The Federal Bureau of Investigation raided two Fairfield County hedge funds on Monday morning, part of a continuing insider-trading investigation. Agents hit Diamondback Capital Management, at One Landmark Square in Stamford, and the New York headquarters of Level Global Investors, which has an office on Steamboat Road in Greenwich.
Both funds are run by former managers of SAC Capital Advisors, also based in Stamford. Diamondback oversees more than $5 billion in assets and Level, about $4 billion.
Insider trading occurs when non-public information about companies is passed to hedge funds, mutual funds or other investors, who make money from their secret knowledge. Federal authorities are said to be wrapping up a years-long inquiry into allegations of market manipulation.
A phone message left for Richard Schimel, Diamondbacks co-founder and co-chief investment officer, wasnt returned immediately. Level Global spokesperson Andrew Merrill sent out the following email:
We can confirm that agents from the Federal Bureau of Investigation visited our offices this morning as part of what we believe to be a broader investigation of the financial services industry discussed in reports over the weekend. We are cooperating fully with the authorities and, at the same time, we are fully operational and continue to work diligently for the benefit of our investors.
David Ganek, who started Level in 2003, owns a large art collection. Hes a major investor in the works of Richard Prince, who makes artwork out of collected items, and the photographs of Diane Arbus.
The FBI also raided Loch Capital Management, a hedge fund based in San Francisco.
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