The hedge fund swindled by Sanjay Valvani, who killed himself just days after being indicted for insider trading, is suing to get the $105 million he earned at the firm back from his widow.
Valvani committed suicide in 2016, just a week after federal prosecutors in Manhattan indicted him and two others for using non-public information on drug applications to game the stock market.
His big-bucks earnings for Visium Asset Management during the decade he was employed at the $8 billion hedge fund made Valvani, 44, a “health-care industry star on Wall Street,” the company said in its Manhattan Supreme Court lawsuit.
The Duke University grad had “appeared to generate legitimate substantial positive returns for the firm and its funds. Indeed, he emerged as one of Wall Street’s leading portfolio managers in the pharmaceutical sector. By all appearances, Valvani was a health-care industry star on Wall Street,” according to court papers.
Flush with cash — Valvani earned more than $30 million in a single year — the father of two endowed $250,000 scholarships at his alma mater and a 6,000-square-foot Brooklyn Heights townhouse, along with a six-bedroom home in the Hamptons. Valvani pleaded not guilty to the $32 million scheme but just days later was found on his kitchen floor with his throat slashed.
His wife and children aren’t entitled to keep his cash, VA Management said in its filing.
“It would be fundamentally unfair for Valvani’s past illegal activity . . . to be permitted to perpetuate a super-luxurious lifestyle for his spouse,” it says in court papers.
The firm is repped by attorney Irving Picard, who led the effort to claw back funds lost in Bernie Madoff’s Ponzi scheme.
Even if VA Management wins its case, the Valvani family will be provided for by a $10 million insurance trust, the company said.
Valvani’s widow, Harjot Sandhu, sold the Brooklyn townhouse last month for $9.8 million. Her lawyers slammed the lawsuit as “completely baseless,” calling Valvani a loyal employee and adding, “It is particularly ironic that the same company that enabled, encouraged and profited from Mr. Valvani’s work is now coming after his estate.”