- Thomson Reuters
The Security and Exchanges Commission said on Wednesday it froze assets of traders using brokerage accounts in London and Singapore to obtain more than $3.6 million in possibly illegal profits before the announcement that SoftBank Group Corp agreed to acquire Fortress Investment Group.
“The SEC’s emergency action to freeze the proceeds of the traders’ highly suspicious transactions within days of the public announcement ensures that the profits cannot be removed from the accounts while the agency’s investigation of the trading continues,” the SEC said in a statement.
SoftBank, a Japanese telecommunications giant, last month announced it would buy the US asset manager for $3.3 billion. Fortress’ stock soared as much as 28% on the news.
“Fortress’s excellent track record speaks for itself, and we look forward to benefitting from its leadership, broad-based expertise and world-class investment platform,” SoftBank CEO Masayoshi Son said in a statement at the time.
Fortress had been struggling in its hedge fund business, and announced in 2015 that it would shut its macro fund and that its head, Michael Novogratz, would leave. The fund had struggled with performance.
The New York-based firm, which focuses on alternative and traditional investment strategies, manages about $70 billion with a mix of businesses including private equity and real estate.
SoftBank in 2014 hired its head of strategic finance, Rajeev Misra, from Fortress.