Sanjay Valvani, the Visium Asset Management partner charged with insider trading last week, was found dead in an apparent suicide at his Brooklyn home. He was 44.

New York City police were called to his home on Monday evening, where they found a knife near his body and a suicide note. Valvani died after an apparent, self-inflicted slash to the neck, a spokeswoman said.

"We mourn the tragic loss of Sanjay, a devoted father, husband and friend," Jacob Gottlieb, Visium's founder, said in a statement on Tuesday.

The stunning development follows Valvani's arrest last week on insider trading charges, which led to Visium's decision to liquidate four of its hedge funds. Valvani, a top lieutenant of Gottlieb's, reaped more than $32 million from trades in drug companies using secret tips, according to federal prosecutors. Valvani's lawyer, Barry Berke, said his client was innocent of the charges.

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Outside of Valvani's brownstone on a tree-lined street in the Brooklyn Heights neighbourhood on Monday, a police van, cruiser and two scooters were parked at around 6:30 p.m. A group of officers stood talking on the sidewalk, with one male cop consoling a woman sitting on the building's stoop crying.

At Visium, Valvani oversaw a portfolio of specialty-pharmaceutical stocks. His performance was so good that rivals at other hedge funds would question Visium employees at conferences about Valvani's confidence in his trades, a former colleague said. Valvani managed as much as $2 billion, including borrowed money, before he was put on leave in April.

We hope for the sake of his family and his memory that it will not be forgotten that the charges against him were only unproven accusations and he had always maintained his innocence.

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A native of Kalamazoo, Michigan, and child of Indian immigrants, Valvani worked at Visium since its 2005 inception. He started out as a sell-side associate at Salomon Smith Barney and joined Gottlieb as an analyst at Balyasny Asset Management in 2003. Two years later, Gottlieb spun out his health-care strategy, bringing along a team of 20 investment professionals including Valvani, to start Visium.

"I really had to convince Jacob Gottlieb that I was hungry to join his hedge fund," Valvani said in a profile by Duke University's Fuqua School of Business, where he got an MBA. "I work hard and try to be the best at what I do, which is why a hedge fund is so suitable for me -- here I have a lot of control over my own destiny."

Visium, which managed $8 billion at its peak earlier this year, last week told clients that it had struck an agreement to sell a multi-sector hedge fund to AllianceBernstein, and plans to close its other funds.

Valvani is survived by his wife, Harjot Sandhu, a former first-grade teacher and reading specialist, and his children.

Visium is the biggest hedge fund in the industry to have employees linked to criminal wrongdoing since the government set its sights on billionaire Steve Cohen's SAC Capital Advisors. That firm pleaded guilty to federal insider-trading charges in 2013, agreed to pay $1.8 billion and was forced to shut its doors.

Stefan Lumiere, a former Visium money manager, was also charged in the case. He was accused of mismarking securities at Visium. His lawyer has said he's innocent. A third former Visium employee, Chris Plaford, pleaded guilty to securities fraud charges.

Valvani died as an innocent man. Because he passed away before his case was resolved, the court is required to dismiss the charges against him.

"This is a horrible tragedy that is difficult to comprehend," Berke, Valvani's lawyer, said. "Sanjay Valvani was a loving father, husband, son and brother and committed friend, colleague and mentor. We hope for the sake of his family and his memory that it will not be forgotten that the charges against him were only unproven accusations and he had always maintained his innocence."

Insider trading investigations can have a devastating emotional impact on people suspected or accused of crimes, leading to public shaming, industry blackballing and the prospect of prison.

In 2011, two days after jurors at a trial of three traders heard Ephraim Karpel discussing suspicious trades in a wiretapped conversation, he hanged himself in his Manhattan office. Karpel, who was 50 and had not been charged, had cooperated with prosecutors by taping fellow traders.

That year, James Fan leaped to his death a day after he was accused of trading on inside knowledge of a health-care company, where he was manager of clinical programming. He was 39.

Dow Jones earlier Tuesday reported the apparent suicide.

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