“Citigroup Inc. on Thursday was fined $30 million by Massachusetts for misconduct by a research analyst who in December provided confidential information about a major supplier of Apple Inc. iPhones,” Saabira Chaudhuri reports for MarketWatch.
“The fine was levied by the Secretary of the Commonwealth of Massachusetts William F. Galvin. Recipients of the nonpublic information about the supplier — Hon Hai Precision Industry Co. Ltd. — include SAC Capital, T. Rowe Price, Citadel and GLG Partners according to the Secretary’s office,” Chaudhuri reports. “According to the Secretary’s office, Kevin Chang — a research analyst employed by a Taiwanese affiliate of Citigroup — released unpublished research information to a hedge fund and institutional clients one day before publishing virtually identical information to the public.”
Chaudhuri reports, “On Dec. 13, following the publication of a report cutting Hon Hai production numbers by the Macquarie Group, an Australian competitor to Citi in covering Hon Hai, Mr. Chang was pressured by large hedge fund and institutional clients for his research on Hon Hai, according to the Secretary’s office. In response, Mr. Chang released the information to at least three units of SAC as well as to other hedge fund and institutional clients, said the Secretary’s office.”
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