Massachusetts has imposed a $30 million fine on Citigroup's research unit, the state announced on Thursday, as it accused a bank analyst of supplying confidential non-public information to big hedge funds and institutional investors.
In a statement, Secretary of the Commonwealth William Galvin said one of the companies affected was Hon Hai, a major supplier of Apple iPhones. According to the state, the research analyst—named Kevin Chang—funneled information to SAC Capital, T.Rowe Price, Citadel, and GLG Partners, among others.
The complaint said that last December, Chang was "pressured by large hedge fund and institutional clients for his research on Hon Hai.' As a result, Chang sent information to "at least three units of SAC", as well as other firms. Chang then published a research note on Dec. 14, containing "virtually identical numbers" that he had already given to the big firms a day before, the complaint said.