Hedge Funds

Diamondback Capital: In a harsh light


Can the firm return to its former glory after insider trading allegations?

Insider trading allegations don’t always cause a hedge fund to shut down. Witness Diamondback Capital Management, one of four hedge funds raided by the Federal Bureau of Investigation in November 2010. While the other three have closed, Diamondback is still open — at least for the moment.

This month, almost a year after another of the four funds, Level Global Investors, shuttered, one of its founders, Anthony Chiasson, was arrested by the FBI in New York City. Todd Newman, formerly a technology portfolio manager at Diamondback, was also arrested, in Boston, and Jesse Tortora, a former analyst