Wednesday, 1 October 2014
Last updated 10 hours ago
Nov 9 2010 | 3:53pm ET
Five defendants in the Galleon Group insider-trading case have asked a judge to dismiss the charges against them.
The five were allegedly part of a second insider-trading ring interlocking with that allegedly headed by Galleon founder Raj Rajaratnam and including former Galleon trader and Incremental Capital founder Zvi Goffer. The five men were arrested a month after Rajaratnam and have all pleaded not guilty.
According to their dismissal bid, federal prosecutors' "convoluted theory” of insider trading isn't backed by any evidence. And what evidence the government does present, the five say, fails to meet the definition of insider trading.
"The material information in question (that certain companies were acquisition targets and that certain companies were potential buyers was already public," Goffer's brief claims. "The arguably non-public information (that Ropes & Gray was representing a long-standing client in making a potential bid) was not material."
Even the one potential instance of material, non-public information is flawed, Goffer's legal team says, as it allegedly traveled to the defendants via Gautham Shankar, a former trader at Schottenfeld Group, where Goffer also formerly worked, from an unidentified roommate of former Moody's Corp. analyst Deep Shah, the only fugitive in the case. But Goffer says there's no evidence that Shankar knew the information was confidential.
Prosecutors allege that Goffer ran a $20 million insider-trading ring, giving sources prepaid cellular phones to call in their tips, paying those sources for the insider information. Much of the information came from the law firm of Ropes & Gray and from Shankar, who has pleaded guilty and is cooperating with prosecutors.
In addition to Goffer, the others seeking dismissal are Goffer's brother, Emanuel, and Michael Kimelman, both of Incremental, and Craig Drimal, a former co-worker of Goffer's at Galleon. Jason Goldfarb, a lawyer at Ropes & Gray, has also asked the judge to toss the case.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
High frequency trading is not evil, it is not a conspiracy and it really is not new; it is the natural evolution of the professional trading community making markets, providing liquidity and hopefully...