The Securities and Exchange Commission charged billionaire Leon Cooperman with insider trading Wednesday, saying that the investor bet on a pipeline company after getting non-public information about a sale it was planning.
Cooperman and his hedge fund, Omega Advisors, got a tip from one of Atlas Pipeline Partners’ executives that the company planned to sell an Oklahoma natural gas processing facility. The fund then bought up securities in the pipeline company, gaining “substantial illicit profits” after the sale was announced and the stock jumped by almost a third, the SEC said.
After Cooperman was subpoenaed in an investigation into his purchase of the shares, he called the executive, telling him to stay quiet and coaching him on what to say in case regulators contacted him as part of the probe, the SEC said. The executive was “shocked and angered” to learn Cooperman had traded ahead of the sale, according to the commission.
“We allege that hedge fund manager Cooperman, who as a large APL shareholder obtained access to confidential corporate information, abused that access by trading on this information,” said Andrew Ceresney, director of the SEC’s Division of Enforcement. “By doing so, he allegedly undermined the public confidence in the securities markets and took advantage of other investors who did not have this information.”
The 73-year-old Cooperman is a renowned investor worth $3.1 billion, according to Forbes.
He is known for his philanthropy and for his high-profile criticism of President Obama’s economic policies. In 2011, he published an open letter warning the president that “the divisive, polarizing tone of your rhetoric is cleaving a widening gulf, at this point as much visceral as philosophical, between the downtrodden and those best positioned to help them.”
Cooperman is sometimes a guest on financial news networks such as CNBC.
