STAMFORD, Conn. -- A portfolio manager from Sigma Capital Management, a division of the Stamford-based based hedge fund SAC Capital, will serve 42 months in federal prison for insider trading, according to a statement from the U.S. attorney for the Southern District of New York.
Michael Steinberg, who was found guilty of various securities fraud charges on Dec. 18, 2013, was sentenced Friday by U.S. District Judge Richard J. Sullivan. As a result of the insider trading scheme, Steinberg earned $1.8 million in illegal profits for his hedge fund.
“Michael Steinberg traded on information from company insiders at Dell and NVIDIA to reap nearly $2 million in illegal profits. Today he has learned the steep cost of those transactions,” U.S. Attorney Preet Bharara said in a statement.
At his trial, Steinberg, 42, of New York City, was convicted of conspiracy to commit securities fraud and four counts of securities fraud. In addition to the prison term, he was sentenced to three years of supervised release and ordered to pay $365,142.30 in forfeiture as well as a $2 million fine.
According to a press release from the U.S. attorney, Steinberg traded in the securities of two publicly traded technology companies, Dell Inc. and NVIDIA Corp., based on inside information that his research analyst Jon Horvath obtained from a circle of analyst friends at different investment firms.
Horvath previously pleaded guilty to insider trading, as did analysts Jesse Tortora, formerly of Diamondback Capital, Spyridon “Sam” Adondakis, formerly of Level Global, Danny Kuo, formerly of Whittier Trust, and Sandeep Goyal, formerly of Neuberger Berman.