U.S. prosecutors Wednesday arrested an employee of an "expert networking firm" on charges that he promoted the firm's services by arranging for corporate executives to leak inside information to hedge funds.
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According to a complaint unsealed in Manhattan federal court, prosecutors claimed that Don Ching Trang Chu, also known as Don Chu, who worked at California-based Primary Global Research, had arranged for hedge funds to get tips on companies including Atheros Communications, Broadcom Corp and Sierra Wireless.
The arrest comes amid a wide-ranging probe by U.S. authorities into potential insider trading at hedge funds, mutual funds and expert networks.
Chu was arrested because he was scheduled to depart to Taiwan on Nov. 28, according to the U.S. attorney's office.
Chu's lawyer,Jeffrey Plotkin, could not immediately be reached for comment.
This action comes as the Janus Capital Group said Tuesday that it has received an inquiry as part of the investigation into insider trading. A day after federal investigators raided offices of three hedge funds, Janus disclosed in a Securities and Exchange Commission filing that it received an inquiry seeking "general information."
Media reports on Tuesday also identified other mutual fund companies in connection with the probe, including Wellington Management, MFS Investment Management Deutsche Bankand Prudential Financial.