This morning federal agents arrested and charged Garrett Bauer and Matthew Kluger with allegedly engineering a decades-long scheme to “trade on inside information, stolen from… law firm Wilson Sonsini Goodrich & Rosati, that netted at least $32 million in illicit profits.”
According to the Department of Justice, the pair is also accused of insider trading based on information looted from law firms Cravath Swaine & Moore, and Skadden, Arps, Slate, Meagher & Flom.
Kluger’s public profile is somewhat thorough, but who is Garrett Bauer?
He’s a prop trader who has worked for RBC, JAG Trading and Lighthouse Financial. He “primarily conducts his trading activity from his Upper East Side apartment.”
Here are the government’s details on him:
Bauer cleared his trades through Goldman Sachs.
He was arrested for securities fraud this morning in New Jersey, and is currently being held in FBI offices there. He is expected to be arraigned in federal court in Newark on the charges.
And that wasn’t the only property he bought, as described in the complaint detail above — he also bought a place in Boca Raton for $875,000.
FINRA records corroborate the government’s complaint.
FINRA had one Garrett Bauer listed in New York — a Garrett Drew Bauer.
That Garrett Bauer has not been FINRA-Registered since August last year, and previously worked for New York firm Lighthouse Financial (from 06/2009 to 08/2010) and venture capital firm Weiss Peck & Greer (from 12/1992 to 01/1995). That Garrett Bauer has passed “1 General Industry/Product Exam,” and zero Principal/Supervisory Exams or State Securities Law Exams.
The complaint also details how Bauer tried to destroy evidence of the scheme. He allegedly destroyed a pre-paid cell phone that he used to discuss the trades, and told another co-conspirator to burn the case he’d earned from the transaction.
There is also a third co-conspirator:
We’ll update when we have more information; a press conference is expected at midday.
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