SEC subpoenas over 50 hedge-fund advisers: report

Reuters ^ | 07/15/08 | Pratish Narayanan

[TigerLikesRooster]

SEC subpoenas over 50 hedge-fund advisers: report

Tue Jul 15, 7:02 AM ET

The U.S. Securities and Exchange Commission (SEC) has sent subpoenas to more than 50 hedge-fund advisers as it investigates whether individuals spread false rumors to manipulate shares in two Wall Street firms, The Wall Street Journal said, citing a person familiar with the matter.

The subpoenas, sent as recently as Monday, are seeking trading and communications data related to short-selling and options trading in Bear Stearns Cos or Lehman Brothers Holdings Inc (LEH.N), the person told the paper.

Rumors have been blamed for the collapse of investment bank Bear Stearns and for the 40 percent slide in Lehman shares this month.

Some of the hedge-fund advisers have received subpoenas related to both probes, while others were contacted with respect to only one.

Among the firms that have received subpoenas are Citadel Investment Group LLC in Chicago and SAC Capital Advisors in Stamford, Connecticut, the paper said.

[TigerLikesRooster]

Maybe they should call Obama.:-)

Hedge fund managers throw weight behind Obama ^

[TigerLikesRooster]

Ping!

[politicket]

Lehman is running scared, and calling upon daddy (a.k.a. - the Federal government) to beat some people up. Lehman (and Bear Stearns) wouldn’t have had their problems if they operated ethical companies.

[Parley Baer]

I’m waiting for Carl to call up Schumer. Hahahaha.

[Orange1998]

They will review the block trades and see who profited. Then they will follow the emails of block buyers for false rumors. End result they will do nothing with the evidence since this been going on for eons and they have never done anything about it.

[victim soul]

Avenue Capital Group
COMPANY

Hedge fund with $12B assets under management.

Official Website:
http://www.avenuecapital.com/

Industry:
Private Equity

Ticker:
(private)

Corporate headquarters:
New York City

EMPLOYMENT

Chelsea Clinton Daughter of Hillary and Bill Clinton

[Libloather]

SEC subpoenas over 50 hedge-fund advisers

My thoughts EXACTLY! Chelsea is in hip-deep.

Will *Hillary's debt be paid off by Big Hedge-Funds?

[Almondjoy]

Perhaps you aren’t an investor or maybe this just isn’t your field, but I would beg you to try and do some homework on the issue.

Manipulation in our markets and are as old as day 1.

In some cases big brother is a good thing. Greedy people in positions of power making the sheep aka the regular joe run like no tomorrow as soon as someone whispers boo.

Overregulation strangulates business. No regulation lets big fish eat the little fish. Do you really think dishonesty and greed should rule the day?

On big issues that impact 300 + million people I’m ok with reining in these criminals.

[em2vn]

Criminals in business have had a free rein for the past 16 years. None of the enforcement agencies have done anything to make business adhere to strict standards.
Worse yet is the FDA. It has let our food and drug supply become infested with non-standard sources who’s products kill and sicken Americans daily.

[politicket]

Manipulation in our markets and are as old as day 1.

I agree with you 100%. However, I'm saying that the problem is not coming from the manipulators on the outside (in terms of that being the primary problem), but from the companies themselves. Lehman Brothers is a prime example. They began heavily investing in hedge strategies in the "glory" days of the 90's that would make Las Vegas blush with embarrassment. Their failed investment strategies are just coming home to roost, and instead of taking the blame, they're putting the fault on the "bogeymen" manipulators.

Just so you know a little about my background, I've been heavily involved in the investment consulting industry for close to 8 years, primarily in the field of certifying and training investment consultants that work with high net-worth clients.

[GOPJ]

Thanks for the ping.

[traviskicks]

what a joke the SEC is, let people do what they want with their money and spread rumors how they will.

[Almondjoy]

Well then I jumped to conclusions.. it seemed to me that you were laser focused on one thing. I certainly wasn’t laser focused on the fact that these companies aren’t to blame too.

However, I’m sure you must also agree that all financials are getting painted with the broad shorting brush and some companies that kept their noses fairly clean are getting taken down as well.

[M. Espinola]

They should also be going after the heads of the major banks for hatching the sub-prime scheme in the first place.

[politicket]

However, I’m sure you must also agree that all financials are getting painted with the broad shorting brush and some companies that kept their noses fairly clean are getting taken down as well.

I agree that the short sellers are going after the financial sector, as well they should. Very few short sellers engage in naked short selling since there are SEC rules against it.

Believe it or not, short sellers play an important dynamic in the health of the marketplace.

[Almondjoy]

But it’s rumors and other unfair trade practices that have cause many to short sell the market.

It is not through fundmentals or technical reasons.. it’s through manipluation that so many shares are being sold short.

Earnings will probably kill a lot of the short sellers. They are getting murdered on Wells Fargo today.

[FastCoyote]

Ruh! Roh!

And here I wanted to start a hedge fund. What was I thimkin?

[politicket]

It is not through fundmentals or technical reasons

Actually, yes it normally is - or else the investor is a fool.

[Almondjoy]

Ever heard of the odd lot theory?

[politicket]

Ever heard of the odd lot theory?

Yes, but what does that have to do with our discussion? The odd lot theory postulates that the existence of trades in odd lots indicates a small, inexperienced investor.

[Almondjoy]

Or the tech bubble of 1999? See where I’m going with this? The real estate investor of this decade?

Do you really think the masses trade with any sort of rationallity at all?