Saturday, 23 August 2014
Last updated 17 hours ago
Jan 3 2014 | 11:46am ET
Prosecutors are set to present what they believe is one of their strongest insider-trading cases at the trial of Mathew Martoma, beginning next week. If they're right, the former SAC Capital Advisors portfolio manager is almost certainly going to prison.
The U.S. Attorney's Office in Manhattan believes that the testimony of two doctors who have admitted to passing confidential information about pharmaceutical trials to Martoma offer them a direct link between the sources of insider tips and the trader employing them, The Wall Street Journal reports. Which is not to say that they've need such a strong link: No person accused of insider-trading in recent years has beaten the rap before a jury.
The most recent accused to fall was Martoma's former colleague at SAC, Michael Steinberg. Steinberg was convicted last month by a jury after just two days of deliberations, despite the fact that there was no direct link between him and the sources of his information. In fact, prosecutors spent much of their time detailing the "pipeline" of four analysts between Steinberg and the actual sources.
Jury selection in Martoma's trial is set to begin on Tuesday.
Even if prosecutors have an all-but assured conviction against Martoma, he has denied them the victory they have sought for years: A criminal case against SAC founder Steven Cohen.
Despite facing decades in prison, Martoma has refused to cooperate with prosecutors in building a case against Cohen. The government believes that Martoma may be their best hope of directly connecting Cohen to illicit trading.
While Martoma could change his mind, prosecutors are not counting on it. "Mathew continues to fight these charges and is preparing for trial," his lawyer, Richard Strassberg, said.
Aug 4 2014 | 7:42am ET
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The Alpha Pages Editor's Note