Life is terribly unfair. You help bring down Raj Rajaratnam and get yelled at by a defense lawyer during another insider-trading trial, but you tell a few white lies, destroy some evidence, warn some of your friends—including the only fugitive in the whole insider-trading crackdown—that the Feds are on to them and perjure yourself a little, and you don’t get to get away with your second insider-trading conviction. Read more »
Informant’s Assistance On Insider Trading Case Slightly Undone By Telling “Series” Of Lies To GovernmentBy Bess Levin
On the one hand, Roomey Khan’s assistance as a cooperating witness was “extremely substantial.” On the other, she seems to have told between 1 and 100 lies to government officials. Read more »
I haven’t been following the Doug Whitman case that closely but I got the vague impression that he wasn’t that guilty. Like, he did his research and thought it was his job to dig up information about public companies, he sought “color” rather than clearly-material hard numbers from executives, and he thought that when insider-trading-trial-Zelig Roomy Khan was saying things like “I am giving you illegal inside information” it was all a big joke, presumably of the you had to be there variety. That all sounds plausible-ish to me, though maybe not much more than that.
Anyway a jury disagreed and now he “faces a maximum possible sentence of 50 years in prison, though he is expected to receive far less than that,” and so I guess it’s time to fire up the old Insider Trading Sentencing Machine and see how much. He seems to have made “over $900,000,” he worked for a hedge fund, and he went to trial, which is all the machine needs to spit out its verdict.*
Which is a sort of frustrating fact about the machine. (And, of course, the actual sentencing regime it represents. The machine faithfully replicates the world, or has so far, more or less.) Here is how you – I, anyway – sort of want it to work:
The axes being (x) amount of money involved, (y) how guilty you are, and (z) how many years you spend in jail. Just going around being like “let’s insider trade, it’s awesome, later we’ll throw hard drives in dumpsters” should get you more time than looking for “color” from tipsters with no duty of confidentiality and occasionally semi-honestly getting, um, vivid lifelike color from tipsters with such duties. Sadly the way it works is more like this: Read more »
Accused Insider Trader Doug Whitman Made A Halfhearted Attempt At The Faux Sympathy Route In Pumping Depressed Informant For Inside InformationBy Bess Levin
…Before losing his patience and wondering aloud what the hell she was good for if not bringing him hot tips. Read more »
In addition to putting up a fancy new website, Raj Rajaratnam and his lawyers filed a motion today to suppress the government’s wiretap evidence.
(Bonus: Check out the glamour shots of Raj)
In a 75-page brief, lawyers for Raj laid out their argument that FBI Special Agent B.J. Kang and the U.S. Attorney’s office in the Southern District of Manhattan intentionally misled the court when they sought authorization to secretly listen in on Raj’s cell phone.
Among several examples, the lawyers argue Rajaratnam only discussed publicly-available information on phone calls with Roomy Khan, a confidential witness in the case, as opposed to any material insider info. Read more »
Roomy Khan, one of the key cooperating witnesses in the Galleon insider trading case, used her extensive rolodex of insiders to gain access to secret market-moving information. Recently released court documents show that list of contacts could be longer than we thought.
So for we know about several of Khan’s associates connected to the case including Raj Rajaratnam, ex-SAC trader Choo-Beng Lee, Ali Far, Intel executive Rajiv Goel, Anil Kumar and Lenaxa Global Management trader Thomas Hardin (aka Tipper X.)
And last week, we learned that prosecutors are running “covert investigations” that involve two individuals occasionally mentioned in several interviews Khan had with federal agents. That info came to light in a motion by Rajaratnam’s seeking access to unredacted transcripts of the interviews. Judge Richard Holwell quickly denied Raj’s motion because of the ongoing investigation. Read more »