David Ganek is a man on a mission, a hedge funder who believes he was wronged by an overzealous prosecutor who raided his offices in 2010 and charged the co-founder of his firm with insider trading. The charges were reversed in 2014, but in Ganek's mind the harm was irreversible. Since then, he's been on a quest for redemption. An in-depth profile from Institutional Investor explains Ganek's motivation and details his long odyssey. This is an excerpt; the complete post can be found here.
The news spread like wildfire across trading floors in New York, Boston and Connecticut: The Federal Bureau of Investigation had raided four hedge fund firms looking for evidence associated with suspected insider trading.
The date was November 22, 2010; the firms in question were Barai Capital Management, Diamondback Capital Management, Level Global Investors and Loch Capital Management. Within months all four had closed, after experiencing significant redemptions from investors as a result of the raids, while the U.S. attorney for the Southern District of New York, Preet Bharara, proceeded with his insider trading investigation across the hedge fund industry. In 2012, Bharara filed charges against 12 individuals from the four targeted firms. But one man was never charged: David Ganek.
While the founder and principal of New York-based Level Global was named in the affidavit submitted to a judge by the FBI in support of the 2010 search warrant, neither he nor his firm — which had $4 billion in assets and was worth approximately $400 million at the time it was raised — were ever charged with a crime. Now Ganek is pushing back.