SAC Capital’s Martoma found guilty of insider trading

NEW YORK — Matthew Martoma, a former portfolio manager at billionaire Steve Cohen’s SAC Capital Advisors hedge fund, was found guilty on Thursday for engaging in what prosecutors called the most lucrative insider trading scheme in U.S. history.

A federal judge in New York found Martoma guilty on all three of the conspiracy and securities fraud charges that he faced, over a scheme that allowed SAC Capital to make profits and avoid losses of $275 million.

The verdict was the eighth insider trading conviction of a current or former employee at SAC Capital, a $14 billion hedge fund that has long been in the cross-hairs of the FBI and Preet Bharara, the U.S. Attorney in Manhatten.

Martoma gave no apparent reaction as the verdict was read. His wife, Rosemary, sat up in her seat in court as the verdict was read, with tears going down her face. They exited the court holding hands.

As photojournalists snapped photos, Martoma walked stone-faced out of the courtroom and into a waiting SUV with his wife and defense team. They did not speak to reporters.

Richard Strassberg, Martoma’s lawyer:

“We are very disappointed and plan to appeal.”

U.S. District Judge Paul Gardephe did not immediately set a sentencing date. Martoma, 39, could face a maximum of 45 years in prison, although the highest sentence to date in an insider trading case is 12 years.

Source: Reuters


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