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An Insider-Trading Tale That Reads Like a Thriller - The New York Times
By ANDREW ROSS SORKINFEB. 7, 2017

“Black Edge: Inside Information, Dirty Money, and the Quest to Bring Down the Most Wanted Man on Wall Street,”
nonfiction  hedge_funds  Andrew_Sorkin  books  slight_edge  insider_trading  informational_advantages  Wall_Street  Preet_Bharara  SAC_Capital  Steven_Cohen  book_reviews  white-collar_crime  Sheelah_Kolhatkar 
february 2017 by jerryking
When the Feds Went After the Hedge-Fund Legend Steven A. Cohen - The New Yorker
ANUARY 16, 2017 ISSUE
WHEN THE FEDS WENT AFTER THE HEDGE-FUND LEGEND STEVEN A. COHEN
Inside the government’s nearly ten-year battle against one of the most powerful men on Wall Street.
By Sheelah Kolhatkar
Wall_Street  Preet_Bharara  insider_trading  hedge_funds  SAC_Capital  Steven_Cohen  white-collar_crime  nonpublic  Sheelah_Kolhatkar 
january 2017 by jerryking
Convicted SAC Trader Loses His Business School Degree - NYTimes.com
March 5, 2014, 1:47 pm
Convicted SAC Trader Loses His Business School Degree
By MATTHEW GOLDSTEIN
SAC_Capital  business_schools  insider_trading  Mathew_Martoma  deception 
march 2014 by jerryking
Cohen Said to Have Warned Friend About Possible Federal Investigation - NYTimes.com
December 23, 2013, 8:59 pm 1 Comment
Cohen Said to Have Warned Friend About Possible Federal Investigation
By MATTHEW GOLDSTEIN
insider_trading  Wall_Street  hedge_funds 
december 2013 by jerryking
The man who strikes fear into Wall Street
February 16, 2013
Preet Bharara, U.S. Attorney for the Southern District of New York / Manhattan's top federal prosecutor has sent more financiers to jail than anyone since the 1980s

JOANNA SLATER
Preet_Bharara  Wall_Street  insider_trading  prosecutors 
february 2013 by jerryking
Insider Trading Persists, and Gets Stealthier - NYTimes.com
By JAMES B. STEWART
Published: December 7, 2012

Why has insider trading proved so persistent, even in the face of prosecutions and popular Hollywood films like “Wall Street”?

The risk-versus-reward equation that has always been a factor in financial markets has changed drastically in the last 20 years....many people who work in financial markets “are highly skilled at cost-benefit analysis,” Mr. Bharara told me. “They’re highly intelligent. They’ve been to the best schools. They weigh the risk of getting caught against the potential reward, and they decide it’s worth the risk. We’re trying to tilt that equation.” There’s no doubt that the potential for gain “has soared,” Robert S. Khuzami, head of enforcement at the S.E.C., told me, and not because there are more takeovers and other market-moving events to trade on. “That’s a big change from the 1980s and ’90s. Hedge funds can take massive positions, use short-selling and derivatives, and employ trading techniques that aren’t transparent, and make huge amounts of money on small fluctuations on price. They don’t need to hit a home run on a $20 pop on a takeover announcement. These bets may be bunts and singles, but they get to the same place.”...The pressure to get an “edge,” as hedge fund traders often put it, has never been greater...In the wake of the Milken-Boesky era, the government has become sophisticated at monitoring major market-moving events like takeover announcements, to the point that insider trading on major corporate news has become relatively rare ...Although some critics say the S.E.C.’s expertise has lagged advances in areas like high-frequency trading, the enforcement division has made progress in monitoring suspicious trading. “We’ve created databases to see who is trading in tandem, even if you know nothing about an event,” Mr. Khuzami said. “It’s a trader-based approach, not an issuer-based approach. These trading patterns are the first clue to what might be insider trading rings. You then have to do the real detective work, pulling phone records and e-mails and using other techniques to uncover the links. ”
insider_trading  Wall_Street  financiers  hedge_funds  Preet_Bharara  investigative_workups  deterrence  Bay_Street  SEC  enforcement  patterns  misconduct  cost-benefit_analysis  slight_edge  trading  stealth  prosecutors 
december 2012 by jerryking
New Breed of SAC Capital Hire Is at Center of Insider Trading Case - NYTimes.com
November 25, 2012, 9:14 pm13 Comments
New Breed of SAC Capital Hire Is at Center of Insider Trading Case
By PETER LATTMAN
hedge_funds  insider_trading  Wall_Street  SAC_Capital 
november 2012 by jerryking
Rajat Gupta, Ex-Goldman Director, to Serve 2 Years in Trading Case - NYTimes.com
October 24, 2012, 4:17 pm96 Comments
Ex-Goldman Director to Serve 2 Years in Prison on Insider Trading Case
By PETER LATTMAN
Rajat_Gupta  McKinsey  incarceration  sentencing  sentencing_guidelines  insider_trading 
october 2012 by jerryking
Ex-Goldman Director Faces New Insider Trading Claim - NYTimes.com
April 16, 2012, 4:15 pmLegal/Regulatory
Ex-Goldman Director Faces New Insider Trading Claim
By PETER LATTMAN

Rajat K. Gupta, the former director of Goldman Sachs and Procter & Gamble who is accused of leaking secret corporate information to the convicted hedge fund manager Raj Rajaratnam, faces a new insider-trading claim.

In a letter filed with the court, the government accused Mr. Gupta of leaking to Mr. Rajaratnam sales forecasts for Procter & Gamble in late 2008.

Mr. Gupta tipped Mr. Rajaratnam off about “P.& G.’s organic sales growth forecast for the October-to-December quarter prior to P.& G.’s public announcement on or about Dec. 11, 2008,” said the letter, which was made public on Monday.
Rajat_Gupta  insider_trading  P&G  Raj_Rajaratnam 
april 2012 by jerryking
David Makol: The FBI Agent Who 'Flips' Insider-Trading Witnesses - WSJ.com
JANUARY 20, 2012 | WSJ |By SUSAN PULLIAM, MICHAEL ROTHFELD and JENNY STRASBURG
FBI  covert_operations  insider_trading 
january 2012 by jerryking
U.S. Targets Insider Culture in Gupta Case - WSJ.com
OCTOBER 27, 2011 | WSJ | By MICHAEL ROTHFELD, SUSAN PULLIAM and S. MITRA KALITA. Gupta Case Targets Insider Culture
Gupta Indictment Shows New Twist in Crackdown; Case Is Gamble for Prosecutors
McKinsey  insider_trading  SEC  Wall_Street  prosecutors  Rajat_Gupta  P&G  Goldman_Sachs  Preet_Bharara  Department_of_Justice 
october 2011 by jerryking
Rajaratnam Faces Longest-Ever Insider Prison Term - WSJ.com
OCTOBER 13, 2011 | WSJ | By CHAD BRAY.

Raj Rajaratnam, the face of the biggest trading scandal in a generation, is expected later this morning to be sentenced to a prison term that could be one of the longest-ever handed down for an insider case.

Enlarge Image
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Associated Press

Raj Rajaratnam

Prosecutors are seeking a sentence of 19 years and seven months to 24 years and five months behind bars during a hearing that is due to begin at 10:30 a.m. Eastern time today. Mr. Rajaratnam's lawyers—citing health problems, among other factors—have been urging the judge to consider a much more lenient sentencing range of 6½ years to 8 years and 1 month.

The one-time hedge-fund titan's prison term could very well exceed 10 years, legal experts said, which was the longest sentence imposed for insider trading in New York in the past two decades.
Inside Information

See some recent and infamous cases involving insider trading.

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Associated Press

Michael Milken arrived at New York State Supreme Court in Manhattan for his arraignment on April 7, 1989.

The 54-year-old co-founder of Galleon Group, who was convicted of five counts of conspiracy and nine counts of insider trading in May, was accused by prosecutors of being at the center of the one of the biggest insider-trading schemes ever unearthed. Mr. Rajaratnam is the highest-profile person to be prosecuted, so far, as part of a broad U.S. government crackdown.
insider_trading  Raj_Rajaratnam  sentencing  incarceration 
october 2011 by jerryking
Lawyers at odds over Rajaratnam’s profits - FT.com
October 4, 2011 | FT | By Kara Scannell in New York.

US prosecutors and lawyers for Raj Rajaratnam, the convicted founder of Galleon Group, squared off in court on Tuesday over how to measure profits the hedge fund founder made from insider trading.

The judge asked the government to submit additional profit calculations and said he would announce his ruling at next Thursday’s sentencing hearing.
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On this story
Prosecutors say Mr Rajaratnam should serve between 235 and 293 months, or a minimum sentence of 19 ½ years, based on gains they now allege exceeded $70m and enhancements for being a leader of the conspiracy and obstructing the government’s investigation during an interview with the Securities and Exchange Commission.

Mr Rajaratnam’s lawyers argued that a better estimate was $7.4m in personal gains, which would place his sentence without any enhancements between six and eight years.
Raj_Rajaratnam  insider_trading  legal_strategies  sentencing_guidelines  SEC  Wall_Street  hedge_funds 
october 2011 by jerryking
In the Insider Trading War, Market-Beaters Beware - NYTimes.com
Sep 22, 2011 |NYT|ROGER LOWENSTEIN.A problem with the SEC’s
focusing on high-return funds is that it skates over the crucial
distinction between short- & LT investing. Some of the 8,000+ hedge
funds in the US are engaged in rapid-fire trading —trying to outguess
the competition w.r.t disclosures that’ll become public in a week.Some
are obsessed with trying to outguess Wall Street “whisper
numbers”.Absent tips regarding forthcoming news, their managers have no
value added/edge. For investors working longer horizons the picture is
different.Skillful, L.T. investors can make $ without tips, by analyzing
info. that’s already public...Society has an interest in genuine
research (e.g. whether GOOG will be a more dominant biz.)...Hedge fund
hypertrading doesn’t add to economic output--it ratchets up mkt.
volatility...A marked increase in volatility complicates the SEC’s
job...the payoff for trading on insider tips rises as well.Ferreting out
the prescient & the crooked becomes more important.
insider_trading  insider_information  SEC  Roger_Lowenstein  white-collar_crime  Wall_Street  hedge_funds  SAC_Capital  volatility  long-term  investing  personal_payoffs 
september 2011 by jerryking
WSJ: Galleon and the Trouble With Insider Trading
Jan/Feb 2010 | The Corporate Board | Andy Kessler.

Information now travels at the speed of light. The edge to human traders
is mostly gone, arbitraged out by fast computers.
Near-term blips in stocks will always be driven by those with industry
contacts, legal or illegal. The only way to truly beat the market long
term is to use your head, think out long-term trends, figure out where
productivity and therefore wealth is being created in the economy,
and invest alongside it. This might include investing in wireless commerce, gigabit broadband, personalized prescription drugs, oil shale extraction, or electric smart grids that can better allocate power to where it is needed.
**********************************************************************
[January 06, 2020 |WSJ| Tech Will Rule These ’20s, Too by Andy Kessler]
So what’s next? My fundamental rule for finding growth trends is that you need to see viable technologies today, and then predict which ones will get cheaper and better over time. Microprocessors, storage, bandwidth—all still going strong after half a century.
2020s  alpha  Andy_Kessler  arbitrage  beat_the_market  broadband  commoditization_of_information  hydraulic_fracturing  ideas  insider_trading  JCK  long-term  personalization  power_grid  productivity  productivity_payoffs  Raj_Rajaratnam  shale_oil  smart_grid  strategic_thinking  technology  traders  trends  trend_spotting  wealth_creation 
june 2011 by jerryking
Consultant for Expert Network Is Convicted in Insider Trading Case - NYTimes.com
June 20, 2011, 12:20 pm Hedge Funds | Legal/Regulatory
Consultant for Expert Network Is Convicted in Insider Trading Case
By PETER LATTMAN
expert_networks  insider_trading  hedge_funds 
june 2011 by jerryking
Galleon Defense Worked—To a Point - WSJ.com
MAY 18, 2011 | WSJ | By SUSAN PULLIAM, JENNY STRASBURG and MICHAEL ROTHFELD.

Some in Hand-Picked Jury Found Rajaratnam Sympathetic. And Guilty, Too
legal_strategies  insider_trading  juries  courtroom_process  case_management  Raj_Rajaratnam 
may 2011 by jerryking
THE GALLEON TRIAL U.S. Attorney Sends a Message to Wall Street
MAY 12, 2011 | NYT | BY BENJAMIN WEISER AND PETER LATTMAN. In
21 months as United States attorney, Preet Bharara has had a major
impact on corporate crime.
Every few days during the trial of Raj Rajaratnam, the Galleon Group’s
co-founder, Preet Bharara, the United States attorney for the Southern
District of New York, would quietly enter the courtroom and take a seat
in the last row of the gallery.

From that unassuming vantage point, Mr. Bharara watched his colleagues
try to persuade a jury to convict the former hedge fund titan of
securities fraud and conspiracy.

The consistent presence of Mr. Bharara at the largest insider trading
case in a generation — and the office’s resounding victory on Wednesday —
signaled that the chief federal prosecutor in Manhattan was back as the
sheriff of Wall Street.
legal  legal_system  profile  Preet_Bharara  insider_trading  prosecutors  hedge_funds  Raj_Rajaratnam  Wall_Street 
may 2011 by jerryking
Galleon Chief’s Web of Friends Proved Crucial to Scheme
MAY 11, 2011| NYT | by PETER LATTMAN AND AZAM AHMED. What made
Rajaratnam stand out was not his proprietary computer models nor his
skills in security analysis. Instead, colleagues marveled at the deep
set of contacts he had cultivated inside Silicon Valley executive suites
and on Wall Street trading floors.

Many of Mr. Rajaratnam’s tipsters came from the South Asian immigrant
community, a relatively small group of Indians, Pakistanis and Sri
Lankans who over the past several decades have made their mark in
finance and technology. ... .All these contacts formed the core of
Rajaratnam’s vast information network. From his office on Madison
Avenue, Rajaratnam collected data about technology companies and then
swapped it with sources across the globe. He spoke of getting an edge to
beat the stock market, and for Mr. Rajaratnam, that edge was
information.
insider_trading  hedge_funds  slight_edge  South_Asia  social_networking  immigrants  ethnic_communities  Raj_Rajaratnam 
may 2011 by jerryking
The Galleon Case Is Nowhere Near Over
May 11, 2011, 2:48 pm Legal/Regulatory | White Collar Watch

By PETER J. HENNING
legal_strategies  insider_trading  Raj_Rajaratnam 
may 2011 by jerryking
Rajaratnam Found Guilty - NYTimes.com
May 11, 2011, 10:50 am Legal/Regulatory | The Galleon Trial
Galleon’s Rajaratnam Found Guilty
By PETER LATTMAN and AZAM AHMED
insider_trading  insider_information  hedge_funds  Raj_Rajaratnam 
may 2011 by jerryking
Raj's defense gamble is smarter than it looks
4/20/2011 | Breakingviews | By Reynolds Holding. The author is a
Reuters Breakingviews columnist. The opinions expressed are his own)
legal_strategies  insider_trading  hedge_funds  Raj_Rajaratnam 
april 2011 by jerryking
Nice Guys, Naughty Information? - WSJ.com
NOVEMBER 24, 2010 | Wall Street Journal | Holman W. Jenkins,
Jr. The SEC wants to help small investors? Stop trying to criminalize
data-gathering.
SEC  insider_information  insider_trading  sleuthing  investors 
november 2010 by jerryking
U.S. Pursues Sweeping Insider-Trading Probe - WSJ.com
NOVEMBER 20, 2010 | Wall Street Journal | by SUSAN PULLIAM,
MICHAEL ROTHFELD,JENNY STRASBURG and GREGORY ZUCKERMAN. Federal
authorities, capping a three-year investigation, are preparing
insider-trading charges that could ensnare consultants, investment
bankers, hedge-fund and mutual-fund traders, and analysts across the
nation, according to people familiar with the matter....The criminal and
civil probes, which authorities say could eclipse the impact on the
financial industry of any previous such investigation, are examining
whether multiple insider-trading rings reaped illegal profits totaling
tens of millions of dollars, the people say...The investigations have
been conducted by federal prosecutors in New York, the FBI and the
Securities and Exchange Commission. Representatives of the Manhattan
U.S. Attorney's office, the FBI and the SEC declined to comment.
insider_trading  hedge_funds  mutual_funds  prosecutors  FBI  SEC  expert_networks  Wall_Street  misconduct 
november 2010 by jerryking
Rajaratnam: Relentless Pursuit of Data - WSJ.com
OCTOBER 24, 2009 | Wall Street Journal | by GREGORY ZUCKERMAN
and ROBERT A. GUTH. The power of the "edge," as Mr. Rajaratnam called
it, also was reflected in how Galleon was organized. At most hedge
funds, traders are supposed to simply execute a firm's trades, which are
dictated by analysts and portfolio managers. Galleon had a different
approach: putting traders in charge of their own capital. A trader who
showed promise would sometimes be given $25 million to $50 million to
invest in a semi-autonomous fashion. To be sure, gathering information
is the lifeblood of most hedge funds. But when it is material, nonpublic
information about a company, it can expose a trader to accusations of
insider trading.
insider_information  Wall_Street  insider_trading  information_flows  private_information  hedge_funds  Raj_Rajaratnam  slight_edge  nonpublic  traders 
october 2009 by jerryking
reportonbusiness.com: Gimme much more
April 25, 2008 G&M column by DOUG STEINER

We all want more information about everything. Yet we often can't get the precious data we need to make good financial decisions, or we don't bother. ...."ANALYZE BEFORE YOU INVEST." We agreed that we didn't heed that advice often enough. But to ABYI, you need hard data, and few companies have ever been eager to disclose it......In 1930's Ontario, companies were only required to table their financial results at their annual meeting, so managers held the meeting in an out-of-the-way place. In 1945, the Ontario Securities Act finally required any company selling shares to the public to provide full and plain disclosure of key financial information in its prospectus.

It wasn't until 1958 that Ontario required companies to file prompt reports of any "material change" in their business. Insider trading on the basis of information not available to the public wasn't outlawed until 1966.....regulators only enforce rules or draw up new ones after problems arise. To act pre-emptively would be hellishly unproductive, and might prompt companies and capital markets to move elsewhere........Better disclosure can help both investors and executives....Even without disclosure rules, you can dig up lots of information about the executives of companies in your portfolio. Last year, U.S. academics David Yermack and Crocker Liu published a study that compared the size and prices of houses bought by CEOs with their companies' share prices. The duo used the excellent U.S. real estate site Zillow.com and other public sources to gather data. On average, the bigger and pricier the home purchased, the worse the subsequent share price performance.

I like to invest in companies where I know the senior managers, and I'm lucky to know many of them. In some cases, much of the information about their character appears in the media. I prefer executives who don't have big photos in their offices of themselves with politicians and other notables. I like CEOs who drive older cars, work all the time and have no hobbies. Boring, focused and cheap.
data  Doug_Steiner  disclosure  '30s  insider_trading  CEOs  mundane  prospectuses  cost-consciousness  focus  unglamorous  boring  investors 
february 2009 by jerryking

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