NEW YORK, Feb 5 (Reuters) – A hedge fund manager, a brokerage trader and a financial adviser were charged on Thursday with insider trading in the stock of supermarket chain Albertsons Inc, reaping total profits of about $7.5 million, according to court documents.
The criminal complaints were filed in U.S. District Court in Manhattan against Joseph Contorinis, a former employee at Jefferies Asset Management LLC, as well as trader Michael Koulouroudis and financial adviser Nicos Achillea Stephanou, whose employers were not immediately known.
Jefferies was not mentioned in the complaint against Contorinis. Firm spokesman Tom Tarrant said Contorinis left a year ago. He declined to comment on the charge or arrest of Contorinis by the FBI on Thursday.
Lawyers for the other two accused men could not immediately be reached for comment. Koulouroudis was also arrested by the FBI on Thursday, and Stephanou has been held since December.
The complaints refer to unnamed co-conspirators, at least one of whom has been arrested and is cooperating with law enforcement authorities about insider trading of Albertsons stock in January 2006.
The complaints also mention insider trading in shares of ElkCorp, a company that makes roofing and building products.
On Jan. 14, U.S. prosecutors filed criminal charges against Ramesh Chakrapani, a managing director at private equity firm Blackstone Group LP (BX.N) for an insider trading scheme involving shares of Albertsons.
Neither the criminal complaint nor the civil complaint identified Chakrapani as a Blackstone employee, but the firm confirmed his identity at the time. Chakrapani was accused of helping people he tipped off about a pending acquisition of Albertsons to make $3.6 million in illegal profits in 2006.
In Thursday’s complaint against Contorinis, FBI agent David Sokol states that a co-conspirator “informed me that he/she provided material, nonpublic information relating to the acquisition of Albertsons to Joseph Contorinis.”
A group including Supervalu Inc (SVU.N), CVS Caremark Corp (CVS.N) and private equity firm Cerberus bought Albertsons in 2006. The U.S. Securities and Exchange Commission said Chakrapani was part of the Blackstone team that advised Albertsons on the deal.
By Grant McCool
(Editing by Lisa Von Ahn)