The U.S. Securities and Exchange Commission won an appeals court ruling that may allow it to collect illegal proceeds from money managers who engage in insider trading even when their firms got all the profit, Bloomberg News reported yesterday. The U.S. Court of Appeals in Manhattan yesterday upheld a lower court’s finding in an SEC lawsuit that Joseph Contorinis, an ex-Jefferies Paragon Fund money manager convicted of insider trading in 2010, must turn over $7.2 million he made for the fund and an additional $2.5 million in interest. The decision could affect future insider trading cases and offers the government “another avenue” to put money managers on the hook for profits, said Marc Agnifilo, a New York defense lawyer who wasn’t involved in the case. Contorinis is serving a six-year prison sentence for his role in the scheme. Jurors found that he traded on tips from an associate director of mergers and acquisitions at Zurich-based UBS AG.
