Wednesday, 25 May 2016
Last updated 3 hours ago
Sep 1 2011 | 12:00pm ET
Former Primary Global Research sales manager James Fleishman "knew full well" he was selling confidential information to hedge funds, prosecutors said yesterday at the opening of Fleishman's insider-trading trial.
Fleishman put those hedge funds and other clients of the expert-networking firm in touch with corporate insiders who then passed on non-public information. Primary Global reaped hundreds of thousands of dollars for its services, Assistant U.S. Attorney Antonia Apps told the jury, which was seated yesterday morning.
"This is a case about stock traders on Wall Street getting an illegal edge," she said. "If you know tomorrow's news today, you can make money—big money."
And for his part, Fleishman "earned hundreds of thousands of dollars of commissions."
Apps said that three former Primary Global consultants that Fleishman put them in touch with clients to whom they spilled the beans. Prosecutors opened their case yesterday with Karl Motey, head of research firm Coda Group and a cooperating witness in the case.
Motey testified briefly about his cooperation and his guilty plea on criminal charges. He'll resume his testimony today.
Before Motey took the stand, Fleishman's lawyers said their client had no idea Primary Global's consultants were providing insider information.
"Mr. Fleishman did his job honestly and honorably," Jay Nelson said. "Mr. Fleishman believed that these consultations were proper and appropriate, and that they were what made PGR a good business."