Wednesday, 29 June 2016
Last updated 9 min ago
Jul 25 2012 | 11:09am ET
John Kinnucan refused to wear a wire as part of the government's investigation into insider trading, a decision he is perhaps regretting today.
Kinnucan, founder of expert-network Broadband Research, is expected to plead guilty today in Manhattan federal court. Kinnucan, whose behavior has been somewhat erratic, allegedly leaving threatening voicemails for prosecutors and going through several lawyers, pleaded not guilty to conspiracy and securities fraud charges in March.
Kinnucan became something of a celebrity two years ago when he refused to cooperate with the federal investigation. But rather than keep that fact to himself, he sent an e-mail to about 50 clients in October 2010 to tell them the Federal Bureau of Investigation had sought his help, and that he had refused. Among the recipients were employees of hedge funds Coatue Management, Citadel Investment Group, Maverick Capital and SAC.
In the wake of the e-mail, Kinnucan became something of a fixture in reports on the investigation, appearing frequently on television. He used the platform to blast the government probe and present himself as a victim of federal persecution, which he accused of destroying his business.
In February, he reaped the animus he had sown when he was arrested, spending more than a week in jail as a federal judge considered several abusive voicemails he left for prosecutors, FBI agents and at least one cooperating witness. To one prosecutor, he said, "Too bad Hitler is not around. You should be in the gas chamber."
According to that prosecutor and others, Kinnucan repeatedly sought and received confidential information about technology companies. He is accused of paying tens of thousands of dollars to one source, Walter Shimoon, who has pleaded guilty in the case. Prosecutors have also linked him to former SAC Capital Advisors trader Donald Longueuil, who has pleaded guilty, and Level Global Investors founder Anthony Chiasson, who was arrested in January and has pleaded not guilty.