Richard Lee, the ex-SAC Capital trader who pleaded guilty to insider trading last week, was fired from a rival hedge fund over a bonus-boosting scheme that was uncovered his first day in a new job, The Post has learned.
Lee was ousted from Ken Griffin’s $15 billion Citadel Investment Group in 2008 for fiddling with the trading books in a ploy to pump up his payout, sources said.
What’s more, it happened during Lee’s first few hours as head of Citadel’s value special situation team, which focused on mergers, according to sources.
Lee never made it to a second day.
Citadel accused him of pulling profits from other trading groups to boost his own performance numbers, a source said.
The 34-year-old Lee, a graduate of Brown University who lives on Chicago’s tony Gold Coast, had been promoted to head of the trading group after the former chief left in March 2008.
Citadel has programs to track such changes and Lee was caught within “three hours,” sources said.
In a statement, Citadel hinted at the reason for Lee’s firing, saying he “transferred positions” in such a way that it “would have impacted only his potential future compensation.”
A year later, he was hired at Steve Cohen’s $14 billion SAC Capital despite objections from the firm’s legal department that he had a reputation for insider trading, according to charges filed against the SAC, which has denied the allegations.
Lee was once part of an “insider trading group” at a rival hedge fund, according to court papers, later identified as Citadel.
Lee’s lawyer, Richard Owens of Latham & Watkins, declined to comment.