Four individuals have been arrested in connection to the massive insider trading fraud that’s sweeping Wall Street.The defendants are Walter Shimoon, Mark Longoria, Manosha Karunatilaka and James Fleishman.
A fifth person Daniel DeVore, a former Dell employee, pleaded guilty to wire fraud and conspiracy to commit securities fraud on December 10 and is a cooperating witness, according to the Department of Justice.
Says the FBI: “Today’s charges allege that a corrupt network of insiders at some of the world’s leading technology companies served as so-called ‘consultants’ who sold out their employers by stealing and then peddling their valuable inside information.”
[Updates: Primary has put Fleishman on leave… Here’s the FBI’s criminal complaint… Said Longoria following arrest at Galleon: “Oh crap!”… Said Shimoon about the iPad in 2009: “It’s a new category altogether… Karunatilaka has connection to raided hedge fund Level Global]
An unnamed New York-based hedge fund employee, who has not been charged, is part of the investigation.
All four who were just arrested were previously employed by PGR, an expert network based in California. Don Chu, previously the only person arrested in this phase of the FBI probe, also worked at PGR.
The case linked to Primary Global escalated with the help of Richard “C.B.” Lee, a former hedge-fund trader, who began cooperating with prosecutors in 2009 after he was ensnared in the Galleon probe. Lee taped conversations he had with Don Chu for the FBI.
The four men are accused of passing on tips about tech giants including Apple, Dell, Advanced Micro Devices, Flextronics, RIM and Seagate Technology, among others.
There are five separate fraud charges; one count of securities fraud and four counts of wire fraud.
- Walter Shimoon is accused of providing insider tips on Apple and Flextronics; he is currently a VP of Business Development (Asia & Americas) at Flextronics, aka Vistapoint Technologies. Previously Shimoon was in sales at Altera, a director at Wyle Electronics and a manager at Nortel.
- Manosha Karunatilaka is a Business Development Manager at TSMC North America, in Boston. Prior to TSMC he was a Technical Marketing/ Project Manager/Sr. Design Engineer at NEC Electronics America; Sr. ASIC Design Engineer at Avaya Inc; and an ASIC Engineer at Avici Systems. He has pleaded guilty.
- James Fleishman is currently an Institutional Equity Sales Executive at Primary Global Research, where he has worked since 1996. He has not been charged, but has been put on leave by his employer. Prior to PGR, he was a Corporate Sales Representative at MailFrontier and an Office Manager at Generic Media.
- Mark Anthony Longoria, is listed as an employee with Advanced Micro Devices in the Austin, Texas.
Fleishman is the only current employee at PGR. On his LinkedIn profile, he describes his work and how it is primarily a job that involves talking to people: ” I have been fortunate enough to get paid to do this as an English teacher in Korea, a salesman at a software start-up in Silicon Valley and most recently on Wall Street working with money managers at institutional power-houses.”
The men were allegedly paid various sums of money for the information they passed on.
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