Visium to Pay More Than $10 Million Over Ex-Traders’ Misconduct

Embattled hedge fund Visium Asset Management will pay more than $10 million to settle a U.S. regulator’s allegations that it illegally profited from former traders’ misconduct, likely closing a sweeping investigation that led to criminal charges against individuals and the collapse of the firm.

Visium’s investment returns were inflated from July 2011 to December 2012 because two ex-credit traders relied on phony broker quotes to mismark bond prices, the Securities and Exchange Commission said in a May 8 order. Steven Ku, Visium’s former chief financial officer, also agreed to pay $100,000 to settle the agency’s allegations that he failed ...