As part of the settlement, Diamondback will give over $6m of allegedly ill-gotten gains and pay a $3m civil penalty.
The settlement would resolve charges of insider trading in shares of Dell and Nvidia in 2008 and 2009.
The Connecticut-based hedge fund adviser has also submitted a statement of facts to the SEC and federal prosecutors, and entered into a non-prosecution agreement with the US Attorney’s Office for the Southern District of New York.
In addition, the hedge fund adviser also consented to a judgment that permanently enjoins it from future violations of federal anti-fraud laws.
Recently, SEC filed insider-trading charges against Diamondback, a second hedge fund advisory firm, and seven individuals, including a former Diamondback analyst and former Diamondback portfolio manager.
SEC New York Regional Office Director George Canellos said that if approved by the court, we believe that the proposed settlement appropriately sanctions the misconduct while giving due credit to Diamondback for its substantial assistance in the government’s investigation and the pending actions against former employees and their co-defendants.
