Prosecutors Laud Insider-Trading Witness' Cooperation

Jan 30 2013 | 12:48pm ET

Whereas Roomy Khan can expect only equivocal support from prosecutors at her sentencing for insider-trading tomorrow, another key cooperating witness will get full-throated backing for leniency next week.

Karl Motey offered "extraordinary" assistance to the federal insider-trading crackdown, prosecutors wrote to the judge who will sentence him on Monday. Motey's lawyer asked that his client received just a year on probation in recognition of that cooperation.

According to Assistant U.S. Attorney Jillian Berman, Motey began cooperating soon after he was approached by the Federal Bureau of Investigation and recorded more than 400 phone calls and other conversations with more than 50 people. His assistance led to the prosecution of more than 20 people, and he testified against hedge fund manager Doug Whitman and expert-network sales executive James Fleischman, both of whom were convicted.

"Motey's assistance has been critical to the investigation and prosecution of dozens of individuals involved in insider trading, most significantly in the area of the government's investigation of the expert networking firm" Primary Global Research, where Fleischman worked, Berman wrote.

And Motey's cooperation continues, prosecutors said.

In addition to Motey, who pleaded guilty two years ago to fraud and conspiracy, two other cooperators will learn their fates in the next few days. Both Khan, whose "series of lies" prosecutors complained about in their sentencing memorandum, and former hedge fund analyst Jason Pflaum will be sentenced tomorrow.


In Depth

Exotic Assets: Investing In Rare Violins

Jan 17 2017 | 4:43pm ET

By definition, alternative investments include exotic assets far beyond your typical...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

The Trump Administration: What It Could Mean for Carried Interest

Jan 19 2017 | 5:25pm ET

The arrival of the Trump administration brings the potential for a repeal of the...