Indian American Accused of Insider Trading

Indian American Accused of Insider Trading

Monday, 30 June 2014, 05:37 Hrs
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NEW YORK: An Indian-origin portfolio manager, convicted for his role as the "central figure" in one of the most lucrative insider trading schemes in U.S. history, should be sentenced to more than eight years in prison, Manhattan's top federal prosecutor Preet Bharara has said.


Mathew Martoma, 39, was convicted in February of one count of conspiracy to commit securities fraud and two counts of securities fraud.  A former portfolio manager of CR Intrinsic Investors, a division of hedge fund giant SAC Capital, Martoma will be sentenced on July 28 and and faces a maximum of 20 years in prison.


Ahead of the sentencing, India-born Bharara asked the federal court here to sentence Martoma to more than eight years in prison for collecting confidential information about a high-profile drug trial and making profits and avoiding losses of USD 275 million for SAC Capital. Martoma, a father of three, even earned a USD 9.3 million bonus for himself due to his various trades for SAC.


"Martoma was the central figure in the most lucrative insider trading scheme ever charged. Over a period of approximately 18 months, the defendant cultivated and corrupted two doctors legally bound to guard confidential information concerning a high-profile drug trial, ultimately obtaining an advance preview of the highly anticipated public announcement of the results," Bharara said in the government's sentencing memorandum submitted in court yesterday.


Bharara alleged that Martoma's entire success in his four years at SAC Capital was based on illegal insider trading. Days after beginning his employment at SAC Capital, Martoma began searching for doctors who would be willing to provide him access to confidential information about an Alzheimer's disease drug trial conducted by Elan Pharmaceuticals and Wyeth Corporation.


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Source: PTI
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