After Big Bet, Hedge Fund Pulls the Levers of Power

[jsr]

http://www.nytimes.com/2014/03/10/business/staking-1-billion-that-herbalife-will-fail-then-ackman-lobbying-to-bring-it-down.html

After Big Bet, Hedge Fund Pulls the Levers of Power
Staking $1 Billion That Herbalife Will Fail, Then Lobbying to Bring It Down
By MICHAEL S. SCHMIDT, ERIC LIPTON and ALEXANDRA STEVENSON | MARCH 9, 2014

WASHINGTON — At a Midtown Manhattan steakhouse last June, William A. Ackman, the activist hedge fund manager who had bet a billion dollars on the collapse of the nutritional supplement company Herbalife, offered his latest evidence to a handful of other hedge fund managers about why the company’s stock could soon plummet.

Mr. Ackman told his dinner companions that Representative Linda T. Sánchez, Democrat of California, had sent a letter to the Federal Trade Commission the previous day calling for an investigation of the company.

The commission had not yet stamped the letter as received, nor had it been made public. But Mr. Ackman, who had personally lobbied Ms. Sánchez and stood to profit if the company’s stock dropped as a result of the call for an inquiry, already knew what it said, and read from a copy of it that he had on his cellphone.

When Ms. Sánchez’s office ultimately issued a news release a month later, it was backdated as though it had been made public the day before Mr. Ackman’s dinner talk.

[reformist2]

1. In an ideal world, the feds would organize a hedge fund convention, and arrest everyone.

[jakeXT]

2. I missed this one /nt