Pequot closes due to investigation

Pequot Capital, one of the largest and most highly regarded hedge funds in America, is closing. The government has been investigating the firm for insider trading violations for several years.

According toThe Wall Street Journal, Arthur Samberg, Pequot's founder, wrote a letter to his investors saying, "Public disclosures about the continuing investigation have cast a cloud over the firm and have become a source of personal distraction." The paper also reports that Pequot's assets under management dropped from $15 billion in 2001 to $3 billion now.