GLG pays out $3.2m to SEC

27 June 2007

Hedge fund GLG Partners is to pay just over $3.2 million in fines after it was found that it had earned $2.2 million in illegal profits.

In a case brought by the US Securities and Exchange Commission (SEC) it was found that GLG had engaged in manipulative short-selling which enabled it to make profits of $2.2 million between July 2003 and July 2005.

The SEC uncovered 16 transgressions on the part of the fund relating to 14 separate public offerings.

The fine consists of $2.2 million in disgorgement, a further payment of $489,455 to cover prejudgement interest and a penalty fine of $500,000. GLC also agreed to forego the profits accrued as a result of the illegal deals.

Linda Chatman Thomsen of the SEC said: "With this action against GLG, the SEC reaffirms its commitment to protecting investors by upholding the integrity of the public offering process."

News of the fine comes as London-based GLG this week announced that it is to go public in the US through a $3.4 billion combination with Freedom Acquisition Holdings.

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