Friday, 25 July 2014
Last updated 8 hours ago
Mar 31 2010 | 2:37am ET
A trading firm that employed three people charged in the Galleon Group insider-trading case has settled civil charges leveled against it by the Securities and Exchange Commission.
Schottenfeld Group agreed to pay $1.2 million, according to a court filing. The New York-based firm also agreed to cooperate with the SEC’s ongoing investigation and enforcement action. Schottenfeld neither admitted nor denied any wrongdoing.
Zvi Goffer, a proprietary trader at the firm, has been accused of masterminding one of the two interlocking insider-trading circles. He, five other traders and two lawyers were sued by the SEC in November. Goffer, known to his fellow insider-trading suspects as “Octopussy,” and one of the lawyers, Arthur Cutillo, have been charged criminally in the Galleon case and have pleaded not guilty.
Two other Schottenfeld employees, Gautham Shankar and David Plate, are among the 21 people charged in the case. Plate has pleaded not guilty, while Shankar has pleaded guilty and is cooperating with the authorities.
Disgorgement of allegedly illicit profits earned for the firm by its traders account for $742,000 of the amount Schottenfeld will pay. The firm also accepted a $371,200 fine and $96,200 in prejudgment interest.
Schottenfeld is still facing a separate SEC enforcement action stemming from the other half of the alleged insider-trading circle, involving Galleon founder Raj Rajaratnam.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…