On Friday the SEC voluntarily dismissed civil insider trading claims against Chartwell Asset Management and, in a separate case, charged a hedge fund manager tied to the Galleon with insider trading.
Chartwell Asset Management Service saw the SEC drop all allegations against it that the agency had filed in July 2011, when it had alleged that Chartwell placed trades on the basis of inside information about Lonza Group’s acquisition of Arch Chemicals.
Chartwell was one of three firms charged in the case; it denied any access to insider information and cooperated with the agency. The other firms are Compania Internacional Financiera S.A. (CIF) and Coudree Capital Gestion S.A.
The SEC had accused the three firms of buying 1.04 million shares of Arch Chemicals Inc. before the company, based in Norwalk, Conn., had agreed to a $1.2 billion buyout on July 11. The result netted the firms millions, according to the complaint.
The SEC also has dropped the case against CIF and Coudree, according to a Reuters report, but said that it seeks permission to pursue charges against them if additional information comes to light. In the report, the SEC said that CIF and Coudree had “repeatedly failed” to cooperate in providing evidence.
When the action was dismissed, funds from Charter that had been frozen were also released.
In the new case, Douglas F. Whitman and Whitman Capital were charged by the SEC with insider trading based on material nonpublic information obtained from Roomy Khan, an associate of Raj Rajaratnam of hedge fund advisory firm Galleon Management.