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Morning Brief: Former Visium Manager Lumiere Barred from Securities Industry

The former Visium Asset Management portfolio manager was earlier sentenced to 18 months in a parallel criminal case for securities fraud.

  • By Stephen Taub

The Securities and Exchange Commission obtained a final judgment against Stefan Lumiere, a former portfolio manager at now-defunct hedge fund firm Visium Asset Management, and barred him from the securities inudstry. Lumiere was sentenced last June to 18 months in prison after being convicted in a criminal case of securities and wire fraud. He was earlier accused of mismarking securities in a fixed-income hedge fund, which inflated the net asset value of the fund and overstated the fund’s liquidity from 2011 to 2013. Lumiere was also sentenced to three years of supervised release.

In the trial, a jury reportedly found him guilty after just 90 minutes of deliberations. He is one of three former Visium portfolio managers criminally charged by the federal government for their roles in several securities violations. Former Visium portfolio manager Christopher Plaford earlier pleaded guilty to seven criminal counts but has not yet been sentenced. In June 2016, the SEC filed a complaint against Lumiere and Plaford, alleging they engaged in a fraudulent scheme to falsely inflate the value of securities held by a hedge fund advised by their firm. The SEC said its action against Plaford has been stayed pending the completion of the criminal case.

Visium portfolio manager Sanjay Valvani was also earlier charged with securities fraud and wire fraud connected to an insider trading scheme. He committed suicide several days after he was charged.

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Lone Pine Capital disclosed in a regulatory filing that as of February 23, it owned nearly 6.4 million shares of Exact Sciences Corporation, or 5.3 percent. It did not own any shares at year-end of the molecular diagnostics company, which is focused on eradicating colorectal cancer.

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CQS (US) disclosed it owns 13.75 percent of DiTech Holding Corp. On February 9, Walter Investment emerged from bankruptcy and changed its name to DiTech. The company originates and services mortgage loans and services reverse mortgage loans.

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