Hedge Fund Manager Settles for Insider Trading Charges

A former hedge fund manager from Westwood was able to settle for $300,000 for insider trading charges with the Securities and Exchange Commission last week, according to Boston.com and an SEC report.

Westwood resident Steven Fortuna ran S2 Capital Management, a $125 million hedge fund, and allegedly violated securities laws on various trades he made in Cambridge-based Akamai Technologies, Inc., according to reports. Fortuna's offer to settle was approved by Jed S. Rakoff, U.S. District Judge for the Southern District of New York, and agreed upon by the SEC.

The SEC filed a case against Fortuna and others in 2009, in which is claimed that Fortuna received a tip in 2008 about Akamai's poor second-quarter earnings. 

According to an SEC document released on Wednesday, Oct. 5, the Commission's original complaint claimed that Fortuna "knew, recklessly disregarded, or should have known that in the material non-public information he received from a tipper was disclosed or misappropriated in the breach of fiduciary duty," and that he was liable for trading that occurred in S2 Capital funds.

Fortuna pled guilty in October 2009 to one count of securities fraud and three counts of conspiracy to commit securities fraud, according to the SEC document.