- A tale of ‘Greek’, ‘Rat’ and ‘bat phones’
- Inside-Trade Probe Snares ‘Octopussy’
- Rajaratnam’s Former Colleagues Cooperate, Plead Guilty in Case
- Schottenfeld Draws Scrutiny After Goffer Arrest in Insider Case
- Rajaratnam Judge Denies Bail Cut, Allows Wider Travel
- Spotlight Shines on Small Trading Firms Organized as ‘Eat-What-You-Kill’ Shops
- SEC Complaint pdfs
A tale of ‘Greek’, ‘Rat’ and ‘bat phones’ – Financial Times
Court documents describing an alleged “insider trading ring” discovered by federal prosecutors hardly read like the details of a typical white-collar case.
The criminal complaints describe how a number of individuals allegedly used throw-away mobile phones, code names and kickbacks…..
Inside-Trade Probe Snares ‘Octopussy’ – Wall Street Journal
Federal authorities widened their crackdown on insider trading, uncovering an alleged network of conspirators with elements of a James Bond movie, including packages of money, throwaway cellphones, a ringmaster nicknamed “Octopussy” and an associate called “the Greek.”
In a 24-page criminal complaint filed in a New York federal court, prosecutors alleged that 14 individuals were part of an insider-trading group that generated $20 million in illegal profits. The group allegedly included several hedge-fund traders, two lawyers, a former junior analyst at a credit-rating firm and a technology-company executive…..
Rajaratnam’s Former Colleagues Cooperate, Plead Guilty in Case – Bloomberg
Choo-Beng Lee and Raj Rajaratnam were colleagues almost two decades ago at research firm Needham & Co. Ali Far worked at Rajaratnam’s hedge-fund firm for at least four years. And when Lee and Far opened Spherix Capital LLC in 2007, Rajaratnam invested with them.
Now, Lee and Far are cooperating in the investigation that has ensnared themselves, Galleon Group LLC co-founder Rajaratnam and 17 others in the largest insider-trading case involving hedge funds. Lee, 53, and Far, 47, pleaded guilty along with three others, including Roomy Khan, a former Galleon employee in the 1990s who is a key witness, prosecutors said yesterday…..
Schottenfeld Draws Scrutiny After Goffer Arrest in Insider Case – Bloomberg
Schottenfeld Group LLC, the firm where three of the people arrested yesterday on insider-trading charges worked, said it was “deeply troubled and shocked” by the allegations against its former employees.
It wasn’t the first time the New York-based company has had to react to allegations of impropriety by its traders. In April 2008, former employee Paul Berliner settled charges he spread false rumors that private-equity firm Blackstone Group LP was about to cut its offer for Alliance Data Systems Corp….
Rajaratnam Judge Denies Bail Cut, Allows Wider Travel – Bloomberg
Raj Rajaratnam, the Galleon Group hedge fund founder accused of directing an elaborate insider- trading ring, lost a bid to cut his $100 million bail.
U.S. Magistrate Judge Theodore Katz in Manhattan today refused to reduce Rajaratnam’s bail to $25 million, as his lawyers requested. Prosecutors opposed the request, saying Rajaratnam may flee the country to escape the charges against him. Katz did allow Rajaratnam to travel across the U.S. as long as he alerts prosecutors. Previously he could go no farther than Philadelphia.
“I don’t really see a reason to revisit the monetary amount,” Katz said in court….
Spotlight Shines on Small Trading Firms Organized as ‘Eat-What-You-Kill’ Shops – Wall Street Journal
An expanding insider-trading scandal is drawing attention to a breed of private investment firms responsible for heavy daily trading that operate largely out of Wall Street’s limelight.
Schottenfeld Group and Incremental Capital LLC have joined Galleon Group and New Castle Funds on the list of trading firms under scrutiny by a federal insider-trading investigation…..
Unlike better-known competitors, these firms don’t pay trader salaries. Rather, they commit capital to a group of individual traders, giving them a sizeable piece of any profits. Should they lose money, they are quickly pushed from the firm. The pressure to produce is high, say traders, and so is turnover……
SEC Complaints against 7 defendants – WSJ (pdf)
Complaints against individuals: Goffer, Shah, Hariri – WSJ (pdf)
Tags: Galleon, Hedge funds, Insider Trading, Legal, Raj Rajaratnam, Schottenfeld, Zvi Goffer
