Pequot Capital Management was a multibillion-dollar

hedge fund A hedge fund is a Pooling (resource management), pooled investment fund that holds Market liquidity, liquid assets and that makes use of complex trader (finance), trading and risk management techniques to aim to improve investment performance and ...

sponsor that closed in 2010. The firm's investment funds invested in a range of markets through a variety of strategies. The firm invested in public equities as well as

private equity Private equity (PE) is stock in a private company that does not offer stock to the general public; instead it is offered to specialized investment funds and limited partnerships that take an active role in the management and structuring of the co ...

venture capital Venture capital (VC) is a form of private equity financing provided by firms or funds to start-up company, startup, early-stage, and emerging companies, that have been deemed to have high growth potential or that have demonstrated high growth in ...

distressed securities In corporate finance, distressed securities are security (finance), securities over companies or government entities that are experiencing Financial distress, financial or operational distress, Default (finance), default, or are under bankruptcy. ...

, and various other fixed income securities. The firm closed in 2010 following allegations of insider trading.

History

Pequot was founded in 1998 by Arthur J. Samberg. Based in

Westport, Connecticut Westport is a town in Fairfield County, Connecticut, United States. Located in the Gold Coast (Connecticut), Gold Coast along the Long Island Sound, it is northeast of New York City and is part of the Western Connecticut Planning Region, Connec ...

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

, the firm had additional offices in

San Francisco San Francisco, officially the City and County of San Francisco, is a commercial, Financial District, San Francisco, financial, and Culture of San Francisco, cultural center of Northern California. With a population of 827,526 residents as of ...

;

New York City New York, often called New York City (NYC), is the most populous city in the United States, located at the southern tip of New York State on one of the world's largest natural harbors. The city comprises five boroughs, each coextensive w ...

;

Los Angeles Los Angeles, often referred to by its initials L.A., is the List of municipalities in California, most populous city in the U.S. state of California, and the commercial, Financial District, Los Angeles, financial, and Culture of Los Angeles, ...

; Greenbrae, Menlo Park; Wellesley; and London,

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. In 2001 Pequot was reported to be the largest hedge fund globally with $15 billion in assets. The firm's venture capital business, Pequot Ventures, spun off on June 30, 2008, into a separate company named FirstMark Capital. The company is based in

. FirstMark Capital received control of Pequot Ventures' existing venture capital portfolio assets.

Closure

In May 2009, the firm announced it was closing and, in an agreement with the Securities and Exchange Commission on May 27, 2010, paid a $28 million settlement (consisting of $18 million in returned profit and $10 million in penalties). Samberg was barred from working as an investment adviser for alleged violations of

insider trading Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider informati ...

involving

Microsoft Corporation Microsoft Corporation is an American multinational corporation and technology company, technology conglomerate headquartered in Redmond, Washington. Founded in 1975, the company became influential in the History of personal computers#The ear ...

stock occurring in 2001 and a prospective new hire of the hedgefund, David Zilkha, from

Microsoft Microsoft Corporation is an American multinational corporation and technology company, technology conglomerate headquartered in Redmond, Washington. Founded in 1975, the company became influential in the History of personal computers#The ear ...

. On May 28, 2009, with an insider trading investigation ongoing, Samberg wrote, "With the situation increasingly untenable for the firm and for me, I have concluded that Pequot can no longer stay in business." SEC awarded $1 million to Glen Kaiser and Karen Kaiser for providing information leading to the settlement. One of the investigators of the case, Gary J. Aguirre, won a whistleblower case after being fired when he recommended that the investigation proceed further.Senate report, pp. 11–14
"The Firing of an SEC Attorney and the Investigation of Pequot Capital Management." Joint report by the United States Senate Committee on Finance and the Senate Judiciary Committee (August 3, 2007). Retrieved February 20, 2011

References

External links

Pequot Capital Management
(company website)
FirstMark Capital
(company website) {{Authority control Financial services companies established in 1998 Defunct hedge funds Hedge fund firms in Connecticut Venture capital firms of the United States Companies based in Westport, Connecticut

History

Closure

References

Further reading

External links