A jury in Manhattan federal court has found former SAC portfolio manager Mathew Martoma guilty of insider trading, Bloomberg News reports.
Martoma was found guilty on all three counts (two securities fraud, one conspiracy).
He faces up to 45 years in prison for all of those counts combined.
This also gives U.S. Attorney Preet Bharara a track record of 79-0 for insider trading convictions.
In the meantime, the judge said Martoma can remain free on bail before his sentencing.
Prosecutors said that Matroma used negative confidential drug trial info in pharmaceutical companies, Elan Corporation and Wyeth, between the summer 2006 and mid-July 2008. The fund was then able to exit those positions and short those stocks avoiding losses of $US276 million.
SAC Capital, Stamford, Conn.-based hedge fund run by Steve Cohen, was criminally indicted last summer on insider trading charges. Federal prosecutors charged the fund “with criminal responsibility for insider trading offenses committed by numerous employees and made possible by institutional practices that encouraged the widespread solicitation and use of illegal inside information.”
In November, SAC pleaded guilty to criminal insider trading charges and agreed to pay a $US1.8 billion fine.
The fund is currently in the process of finalising its new corporate structure and picking a new name. SAC Capital will no longer manage outside capital and will operate as a family office fund.
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