22 hedge funds settle with the SEC for $14.4 million

Agency charged 23 funds with market manipulation

The Securities and Exchange Commission (SEC) is smiling today. The agency announced that it has closed the books on charges that some hedge funds had manipulated the market.

The SEC said it has reached a settlement with 22 of the 23 firms it accused of violating its Rule 105, which prohibits investment funds from short selling a company’s stock within the five days prior to a company’s public offering and then buying new shares in the public offering. The agency accused the hedge funds of buying shares from a broker, dealer or underwriter in a public offering days after short selling the same securities.


Cathleen Flahardy

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