Curious Diversions in Wall St. Insider Trading Case
source: http://dealbook.nytimes.com/2011/03/07/curious-accusations-in-s-e-c-s-insider-case/
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Seconds after Rajat K. Gupta, then a director of Goldman Sachs, finished up a board call during which he learned that Warren E. Buffett had agreed to invest $5 billion in the firm, he picked up the phone and called his friend Raj Rajaratnam, regulators contend. Minutes later, Mr. Rajaratnam placed bets on shares of Goldman Sachs that netted his firm, the Galleon Group, $900,000.
The Securities and Exchange Commission, which accused Mr. Gupta of insider trading last week, says this happened not once, but repeatedly. He did the same thing at Procter & Gamble, where he was also a director, the S.E.C. claims.
Given the seriousness of the claims — insider trading by an executive who had reached the upper echelons of corporate America — why not bring criminal charges against Mr. Gupta?
Well, that’s where the facts of the case get a little mushy, and they are starting to raise some questions among lawyers about the S.E.C.’s motivations.
“This is very unusual. It’s a red flag,” Kip Weissman, a partner at Luse Gorman Pomerenk & Schick in Washington and a former S.E.C. enforcement lawyer, said of the case.
Not only has the Justice Department not brought a criminal case, at least not yet, but the S.E.C. decided to bring its case in front of an administrative law judge instead of in a Federal District Court, where a defendant has full discovery rights. The S.E.C. is using a new provision in the Dodd-Frank Act to bring the case this way.
http://dealbook.nytimes.com/2011/03/07/curious-accusations-in-s-e-c-s-insider-ca...
The Securities and Exchange Commission, which accused Mr. Gupta of insider trading last week, says this happened not once, but repeatedly. He did the same thing at Procter & Gamble, where he was also a director, the S.E.C. claims.
Given the seriousness of the claims — insider trading by an executive who had reached the upper echelons of corporate America — why not bring criminal charges against Mr. Gupta?
Well, that’s where the facts of the case get a little mushy, and they are starting to raise some questions among lawyers about the S.E.C.’s motivations.
“This is very unusual. It’s a red flag,” Kip Weissman, a partner at Luse Gorman Pomerenk & Schick in Washington and a former S.E.C. enforcement lawyer, said of the case.
Not only has the Justice Department not brought a criminal case, at least not yet, but the S.E.C. decided to bring its case in front of an administrative law judge instead of in a Federal District Court, where a defendant has full discovery rights. The S.E.C. is using a new provision in the Dodd-Frank Act to bring the case this way.
http://dealbook.nytimes.com/2011/03/07/curious-accusations-in-s-e-c-s-insider-ca...
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ampersand
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I am shocked, shocked, I tell you, to find flagrantly corrupt behavior uncovered at the top echelons of Goldman Sachs!
And, it can't possibly be true there is a cover-up and special treatment being meted out at federal level to the perpetrator as inferred by the New York Times article.... - 1 year ago
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ampersand
