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| Indian-origin hedge fund manager |
| Indian-origin hedge fund manager indicted in insider trading
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| UNITED STATES OF AMERICA
, 26-December-2012
5:22:59 AM |
| A former SAC Capital Advisors portfolio manager was indicted on Friday on securities fraud and conspiracy charges in a case that federal prosecutors have called the most lucrative insider trading scheme ever uncovered.
A federal grand jury in Manhattan indicted the former portfolio manager, Mathew Martoma, a month after the government arrested him on charges that he used inside tips about a clinical drug trial to help SAC earn profits and avoid losses. Prosecutors said the total benefit to SAC was $276 million.
SAC, based in Stamford, Conn., has been touched by several insider trading cases in recent years, but there is heightened attention surrounding the Martoma prosecution. For the first time, the government has tied questionable trades to Steven A. Cohen, the billionaire owner of SAC.
"Though disappointing, today's events come as no surprise," Mr. Martoma's lawyer, Charles A. Stillman, said in a statement. "The simple fact is that Mathew Martoma did not trade on inside information, is innocent of all these charges, and we look forward to his ultimate vindication."
Before Friday's indictment, there had been speculation that the government, before formally presenting evidence to a grand jury, was trying to gain Mr. Martoma's cooperation in building a case against Mr. Cohen. Mr. Martoma has rebuffed several earlier efforts by the authorities to enter into plea talks and implicate his boss.
Mr. Cohen has not been charged with any wrongdoing, and a spokesman for SAC has said that he thinks that he and SAC have acted appropriately at all times. The Securities and Exchange Commission, which brought a parallel civil action against Mr. Martoma, has warned SAC that it is likely to file a fraud lawsuit against the firm related to the Martoma case.
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