August 15, 2011 – By Andrew Longstreth
NEW YORK (Reuters) - Former FrontPoint Partners hedge fund manager Dr. Joseph "Chip" Skowron pleaded guilty on Monday for his role in an insider trading scheme.
Skowron, 42, told a Manhattan federal court judge that in 2008 he traded stock in Human Genome Sciences Inc on nonpublic information he received from a French doctor who served as a consultant for the biotech company.
Skowron, who managed several healthcare funds, also admitted he gave false testimony under oath to the U.S. Securities and Exchange Commission.
"I knew my actions were wrong and I deeply regret my participation in these activities," he told U.S. District Court judge Denise Cote.
The Greenwich, Connecticut resident, who has a medical degree and doctorate in cellular and molecular biology from Yale University, was one of the most prominent investors to become embroiled in a two-year crackdown on insider trading.
In April, federal prosecutors charged Skowron with showering a French physician, Dr. Yves Benhamou, with cash and a luxury trip to New York in exchange for information about Human Genome. Prosecutors said tips from Benhamou about the company's experimental hepatitis C treatment helped Skowron's funds avoid $30 million in losses.
Benhamou pleaded guilty in April to providing tips about Human Genome to Skowron.
At the court hearing Monday, Skowron said he provided Benhamou with benefits and received tips from him.
"I understood what I was doing was illegal," said Skowron, who appeared composed throughout the hearing.
Under an agreement with prosecutors, Skowron pleaded guilty to conspiracy to commit securities fraud and obstruct justice.
Skowron faces a maximum of five years in prison. He is scheduled to be sentenced November 18.
The case is U.S. v. Joseph Skowron, U.S. District Court, Southern District of New York, No. 11-00997.
(Editing by Gerald E. McCormick and Robert MacMillan)