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Regulation and Compliance > Federal Regulation > SEC

SEC Bars Hedge Fund Manager

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BOSTON (–In what amounts to a bit of housekeeping and not much else, the Securities and Exchange Commission has barred a hedge fund manager accused of insider trading from associating with any investment adviser.

Michael K. C. Tom, who ran Global Time Capital Management LLC, used inside information about a pending merger between Citizens Financial Group Inc. and Charter One Financial Inc. to profit from the deal. He pleaded guilty to federal charges along those lines last month, and he now faces up to 10 years in prison, three years’ parole and a $1 million fine.

In the course of her job, Shengnan Wang, a Citizens employee, came across information that Citizens was finalizing due diligence on Charter One in anticipation of buying the bank. She passed the news on to Mr. Tom, himself a former Citizens employee, and to her husband, Hai Liu.

Ms. Wang and Mr. Liu had about $60,000 invested in Mr. Tom’s Global Time hedge fund. Acting on the tip, Mr. Tom bought Charter One securities for both the hedge fund and for personal accounts. He allegedly earned more than $700,000 in profits when the deal went through.

The SEC filed civil charges against all three people involved.

Mr. Tom consented to the SEC’s order without admitting or denying the commission’s findings.

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Contact Bob Keane with questions or comments at [email protected].


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