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One Day You're Bonding With A New Friend At A Bachelor Party, The Next You're Standing Trial On Insider Trading Charges

Martyn Dodgson and Andrew Hind know what we're talking about.
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Let this be a lesson to you all. More lap dances and waking up face down on a bathroom floor, less building the foundation for an (allegedly!) fruitful securities fraud operation.

The FCA alleges Dodgson, Andrew "Grant" Harrison, a former stockbroker at Panmure Gordon & Co., Benjamin Anderson, a 71-year-old private day trader, former Aria Capital Ltd. director Iraj Parvizi, and Hind, 55, worked together to trade securities with inside information between November 2006 and March 2010. The FCA claims Dodgson and Harrison passed price-sensitive information from their jobs in the corporate broking departments of big firms to Hind, who then passed it to Anderson and Parvizi to trade on...Dodgson first met Hind at his brother’s bachelor party in July 2001. While Dodgson said he had “no recollection of the stag party,” he and Hind became good friends. "He was extremely impressive," Dodgson said in court. "At that time there were not many people that I spoke to who had such an insight into business and the markets more generally." The investigation, which has been dubbed Operation Tabernula, centers on trading in six stocks, including Sky Plc and Legal & General Group Plc, from which the FCA alleges the men made 7.4 million pounds ($10.3 million) in profits.

Biggest Insider-Trading Case in U.K. Started With 'Stag Party' [Bloomberg]


Rajat Gupta Defense Team: You Think Our Client Would Pass Inside Information To A Guy Who Didn't Even Have The Decency To Invite Him To His Birthday Party?

What motivates people to share material non-public information with a person they know will use it for profit? For some, it's simply about greed. For others, it's about the thrill. For yet others, it's about pillow talk. For Rajat Gupta, the McKinsey director currently on trial for allegedly passing inside information to Raj Rajaratnam, it's about friendship, according to prosecutors who are trying to make the case that Raj and Rajat were the best of buds and that's what buds do. They they back each other up when they drunkenly hit on the girlfriend of the wrong guy at the bar, they stand up as best men at each others' weddings, they pick up the phone and say "Buy GS" when they know for a fact Warren Buffett is about to do so, too. And although attorneys representing Gupta don't deny the two were thick as thieves, they argue that while perhaps back in the day Rajat would have provided useful information to Raj, there is no way he would have done so after Big R twice violated the bonds of friendship. In the first instance, there was this: Defense attorneys have argued that Messrs. Gupta and Rajaratnam had a falling out in fall 2008 after Mr. Gupta lost his entire $10 million investment in a fund managed by Mr. Rajaratnam and therefore wouldn't have passed along inside information...The precise timing of their relationship's deterioration could be crucial in proving Mr. Gupta's guilt or raising doubts in the minds of jurors about whether he conspired to commit securities fraud...Defense attorneys have said Mr. Gupta was furious at Mr. Rajaratnam in the fall of 2008, when Mr. Gupta's $10 million investment in a fund called Voyager Capital Partners Ltd. evaporated. According to Mr. Kumar's testimony, Mr. Gupta felt Mr. Rajaratnam's negligence had allowed Voyager to collapse. And then this happened: