Former Hedge Fund Exec Pleads Guilty In Pharma Stock Scandal

Law360, New York (October 13, 2005, 12:00 AM EDT) -- A hedge fund manager pled guilty Wednesday to lying to regulators about how much stock his fund held in various biopharmaceutical companies and inflate demand for their stock.

The Securities and Exchange Commission sued Wednesday Douglas Schmidt, former chief operating officer of Connecticut-based Durus Capital Management. He has since admitted to making false statements to the agency in February 2003 and March 2003.

Schmidt now faces up to 20 years in prison, according to a U.S. Attorney Connecticut.

When Schmidt’s scheme was exposed, the stock of...
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