SEC charges Carlson Capital with violating short selling policies

September 28th, 2010
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The SEC has charged Clint Carlson’s Carlson Capital with four occasions of improperly short selling stocks and subsequently participating in the public stock offerings. According to the SEC, Carlson Capital’s portfolio managers had access to other managers’ trading positions and trade reports, were able to confer with one another about companies, all reported to one supervisory chief investment officer, and were permitted to coordinate trades with one another.

The short selling practices enabled by the managers’ collaboration violates the SEC’s Rule 105 of Regulation M. In particular, the SEC alleges that the portfolio manager who “sold short the particular stock during the restricted period received information - before the short sales were made - that indicated the other portfolio manager intended to buy offering shares.”

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Carlson Capital
Related People: Clint Carlson; Jason Karp*; Mike McMahon; Ronald Hulme*
Related Entities: Asgard Investment Corp; Black Diamond Hedge Funds; Carlson Alternative Advisors; Carlson Capital GP; Carlson Capital LP; Carlson Offshore Advisors; Double Black Diamond LP
Related Article Tags: Hedge Fund Fraud and Ponzi Scheme News

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