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SEC fines Brahman Capital, alleging supervisory failure

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SEC fines Brahman Capital, alleging supervisory failure

Brahman Capital Corp. will pay $250,000 to settle the SEC's charges of supervisory and compliance failures.

At issue is the lack of "reasonable steps" taken to discipline a senior research analyst who repeatedly and over several years violated the hedge fund adviser's policies protecting confidential information. The analyst, Paritosh Gupta, had provided investment recommendations, staffing advice and Brahman's proprietary investment theses and models to Nehal Chopra, a principal at Ratan Capital Management LP. He also gave Chopra direct access to third-party market intelligence paid for by Brahman. Gupta was dating Chopra at the time and eventually married her.

The SEC found that Brahman had been aware of some of Gupta's actions, monitored his correspondence and reminded him on a number of occasions not to share confidential information. It was not until March 2013, however, that Brahman initiated Gupta's departure from the company. Gupta now works as a principal and portfolio manager of Adi Capital Management LLC.