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Ex-Wife Of David Slaine Is Weary And Wet

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A couple weeks back, the Wall Street Journalprinted a story naming trader David Slaine as a key cooperating source in the Galleon insider trading case, having allegedly ratted out several of his friends and co-workers, including nightclub bouncer-cum-hedge fund employee, Craig Drimal. The article also claimed that during his long career on Wall Street, Slaine smashed a keyboard to pieces, started a fistfight over a colleague who wouldn't share his French fries, and punched his Galleon boss, Gary Rosenbach in the face, while the two were stark-naked in an Equinox steam room. We wrote about it, mostly out of empathy for the fries situation (that's something to legitimately get upset about) and a commenter by the name of "Elyse" came along and said that basically everything in the Journal's story was untrue, but especially the bit with the fries (never happened, she said), and the steam room (where, according to E, David didn't punch Rosenbach but rather slapped him, which is different). "Elyse" then emailed us (she hadn't appreciated our tone) to say say that she was Elyse Slaine, the ex-wife of Big D (who she met in 1992, when he was working for Morgan Stanley and she was selling financial technology for Knight Ridder), and to reiterate that the Journal doesn't know shit. Last Friday, the Observersat down with ES to find out why.
First off, she didn't do this for the fame, or the glory.

"I feel," Elyse Slaine said over a nine-dollar cup of coffee at the Pierre Hotel last Friday, "like someone has to tell the truth." The 46-year-old was wearing studded Louboutin boots, a ruby ring on her right hand and a Harry Winston diamond watch on the other.

Someone need to set the record straight! And event though her ex-husband told her not to, Elyse knew that someone was she.

[David Slaine] hasn't endorsed [the crusade]. "I'm defending him because he's a good guy," she said. "He doesn't want me to." Mr. Slaine, who, The Journal said, has pleaded guilty to conspiracy and securities-fraud charges, and cooperated with the government to gain favor, did not return calls.

In spite of the fact that he once ruined one of their date-nights.

His marriage began to end four years ago. "My interests became a little more diverse. I like to travel," Ms. Slaine said. "I enjoy theater. David, the one time we went, fell asleep. It was Bring in 'da Noise, Bring in 'da Funk."

Because Elyse, too, knows what it's like to be standing in the middle of the crisis, to feel like you're drowning, with no one to throw you a life saver.

Earlier this month, Ms. Slaine returned to her Park Avenue apartment, the co-op she used to share with Mr. Slaine, to find massive flooding. A bathroom pipe had burst. "My own personal tsunami," she sighed.

And if she's ineffectual, fine, at least she tried. It's important to her to set the record straight, but it's not the only thing Elyse has on her plate.

Ms. Slaine is on to other things. She said at coffee that she was headed to China, where she wants to produce a charm for women's purses that turns into a hook. She took out a prototype and hung her handbag from the Pierre cafe's table: "Patent pending," she explained.


David Slaine, Government's Undercover "Tip-Mining Machine," Apparently Under The Impression Insider Trading Works On A 3-Strike Basis

Remember David Slaine? For those who need a refresher, he is the former Morgan Stanley managing director and ex-Galleon trader who began working as an FBI informant in 2007 and who was outed for doing so by the Wall Street Journal in January 2010. At the time, we learned a few notable things about Slaine, some of them germane to his role in helping the government go after people trading on material non-public information, others special in their own way, like: 1. He takes french fries, and perhaps all snacks, very seriously. In 1993, Slaine triggered a fist-fight with a colleague on the trading floor after needling him because he wouldn’t share his french fries. Others broke up the fight. 2. He doesn't wait for people to towel off and get dressed before knocking their teeth out. One morning early in 2001, before trading began, Gary Rosenbach, then was the No. 2 executive under Mr. Rajaratnam, and Slaine were in a steam room together after exercising at an Equinox Fitness Club. Mr. Rosenbach was pressuring Mr. Slaine to improve his performance. As Mr. Rosenbach lay on his back on a bench, Mr. Slaine punched him, giving him a black eye and ending their friendship. 3. Humans aren't the only ones often asked "you want a piece of me?" He once smashed a computer keyboard in a fit of rage, says a person familiar with the incident. 4. While working on Wall Street, he eschewed the traditional channels of employee recruitment (Wharton, etc), preferring instead to pick up fresh analysts at the club. While at Morgan Stanley, he met [Craig] Drimal, then a nightclub bouncer at the Vertical Club in Manhattan. The two quickly formed a friendship based on a shared passion for weight lifting and their mutual ability to bench-press 400 pounds...Shortly after arriving at Galleon, Mr. Slaine persuaded Galleon officials to give a position to Mr. Drimal, who then was working as a bouncer at the Roxy nightclub in Manhattan. 5. Being a person with whom he "formed a friendship based on a shared passion for weight lifting and [a] mutual ability to bench-press 400 pounds," possibly the greatest line written about anyone who's ever worked on Wall Street and which which cannot be said enough, means little in the long run if he knows you've been playing it fast and loose with securites laws. In July 2007, the FBI showed up at Mr. Slaine's door on W. 57th Street in Manhattan and confronted him. Mr. Slaine agreed to help the government. At the time, federal prosecutors in Manhattan were trying to make headway on another investigation that eventually led to the charges involving Galleon. They asked Mr. Slaine who he knew that might be participating in insider trading. Mr. Slaine's answer: his friend Mr. Drimal, according to people familiar with the matter. In September 2007, Mr. Slaine—identified in the complaint as CS-1—tried out his body wire for the first time, meeting Mr. Drimal in New York. During the meeting, Mr. Drimal gave Mr. Slaine a piece of paper with four stock symbols, according to the complaint. He told Mr. Slaine the four companies were all acquisition targets. At the meeting's end, Mr. Drimal told Mr. Slaine to destroy the list. He warned him to "be careful" in trading the securities because no news of the takeovers had surfaced publicly...After the meeting, Mr. Slaine went to a nearby hotel where an FBI agent was waiting, says a person familiar with the matter. The pair went to a room where Mr. Slaine removed the wire. Anyway, Bloomberg recently checked in to see what Slaine's been up to these last couple years and other than his "multi-year experience" with the FBI being "tremendously traumatic," he seems to be doing pretty well.

Informant's Assistance On Insider Trading Case Slightly Undone By Telling "Series" Of Lies To Government

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.