November 18, 2011 / 5:04 PM / 7 years ago

Ex-FrontPoint fund manager to serve 5 years prison

NEW YORK (Reuters) - Former FrontPoint Partners hedge fund manager Dr. Joseph “Chip” Skowron was sentenced to five years in prison on Friday for his role in an insider trading scheme.

Skowron, one of the most prominent investors to become embroiled in a sweeping U.S. crackdown on insider trading at hedge funds, pleaded guilty in August to trading in 2008 in stock of Human Genome Sciences Inc HGSI.O on nonpublic information.

He admitted receiving the information from a French doctor, Yves Benhamou, who served as a consultant for the biotech company. Benhamou pleaded guilty in April to providing tips about Human Genome to Skowron.

“You engaged in a pattern of deceit,” Manhattan federal court judge Denise Cote told Skowron in imposing sentence. “You bribed and corrupted another physician.”

The five-year prison term was the maximum he faced under an agreement between U.S. prosecutors and his defense lawyer, Jim Benjamin. Cote ordered Skowron to forfeit $5 million. She also said he would be required to pay millions more in restitution to be decided by June 2013.

Skowron, 42, who managed several healthcare funds, had also admitted giving false testimony under oath to the U.S. Securities and Exchange Commission.

“I’m looking forward to healing and rehabilitation and I’m terribly sorry for the mistakes I have made,” Skowron told the judge on Friday in the courtroom, which was filled with family and friends of the disgraced doctor.

The case is USA v. Skowron, U.S. District Court for the Southern District of New York, No. 11-699.

Reporting by Grant McCool; Editing by Tim Dobbyn

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