May 7, 2013 / 1:00 PM / 4 years ago

U.S. seeks up to 10 years prison for Level Global's Chiasson

* Chiasson convicted over trades in Dell, Nvidia

* Co-defendant Todd Newman got 4-1/2 years prison

May 7 (Reuters) - Federal prosecutors want the co-founder of hedge fund firm Level Global Investors LP to spend as much as 10 years in prison for insider trading in shares of two technology companies.

The government said in a Manhattan federal court filing that Anthony Chiasson, who was convicted in December of securities fraud and conspiracy, should spend 97 to 121 months behind bars.

This is in line with nonbinding federal sentencing guidelines, prosecutors said in the court papers filed Monday night. Chiasson, 39, is scheduled to be sentenced on May 13 by U.S. District Judge Richard Sullivan.

The proposed term is shorter than the roughly 10 to 12-1/2 years recommended in a pre-sentence report by a probation officer. A 12-1/2 year term would be a record in a U.S. insider trading case.

In December, a jury convicted Chiasson of using confidential information to trade in shares of computer maker Dell Inc and chipmaker Nvidia Corp ahead of earnings reports in 2008 and 2009.

Prosecutors said the trades resulted in more than $68 million of illegal profit for Level Global. They said Chiasson was aware that his research analyst Spyridon “Sam” Adondakis was getting inside tips, and that he directed Adondakis to create trading “templates” to conceal how the tips were used.

Adondakis pleaded guilty in January 2012 and testified against his former boss.

Todd Newman, a Diamondback Capital Management portfolio manager convicted at Chiasson’s trial, was sentenced by Sullivan on May 2 to 4-1/2 years in prison. Prosecutors had sought up to 6-1/2 years.

Lawyers for Chiasson last month said their client deserves leniency, given that he has a wife and two children, and has many charitable endeavors.

The office of U.S. Attorney Preet Bharara in Manhattan did not immediately respond on Tuesday to a request for comment. A lawyer for Chiasson was also not immediately available.

Level Global closed in 2011 following an FBI raid, and has been winding down.

On April 29, the U.S. Securities and Exchange Commission ordered the Greenwich, Connecticut-based firm to pay $21.5 million to resolve civil fraud charges related to the conduct of Chiasson and Adondakis.

The case is U.S. v. Chiasson, U.S. District Court, Southern District of New York, No. 12-cr-00121.

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