A former KPMG partner is charged in an insider trading case, accused of providing illegal tips to a friend about the auditing firm’s clients.
Read more here: Ex-KPMG partner charged with insider trading
Category : Business
US authorities file criminal and civil charges against a former senior partner at accountancy firm KPMG over alleged insider trading.
Read more here: Ex-KPMG partner on insider charges
‘I have no idea what I was thinking,’ says ex-partner after auditor forced to resign as auditor for Herbalife and Skechers
A former KPMG accountant has blamed a “lapse of judgement” for the insider dealing scandal that has cost him his job and sparked a federal investigation.
Scott London, the partner in charge of the audit practice for KPMG in southern California, was fired by the accounting firm on Monday after it emerged he had given insider tips on the accountant’s clients to an unnamed investor. London, 50, had worked for KPMG for 29 years.
KPMG has resigned as auditor of two companies, supplements firm Herbalife and Skechers, a shoe company, after London breached their confidentiality. The Justice Department and Securities and Exchange Commission are now investigating a case that is causing the accountancy firm major embarrassment.
“I have no idea what I was thinking. I don’t know why there was a lapse of judgment, but there was,” London said in an interview with the Los Angeles Times.
London said he barely benefited from his decision to tip off a friend about his clients, a friend who it appears then set him up with the Feds.
According to the LA Times, London met a friend at a Starbucks in the San Fernando valley for what he assumed was a casual coffee. The friend handed him an envelope containing $5,000 cash. Unbeknown to London, he was being photographed secretly by the FBI.
London told the LA Times he had given the friend information because the friend was struggling financially. In return, he reportedly received about $25,000 in cash, a new Rolex watch and fancy dinners.
At KPMG, London managed more than 900 workers and was “responsible for monitoring the mentoring and performance evaluation of the employees as well as the overall growth and quality initiatives within the audit practice,” according to his profile on the Directors’ Organization, a group for companies’ board members.
The audit firm resigned from Herbalife and another firm after discovering one of its partners allegedly passed on insider trading information.
Visit link: KPMG resigns as auditor of Herbalife and Skechers
Rengan Rajaratnam – currently living in Brazil and likely to be extradited – was frequently mentioned in his brother’s 2011 trial
US authorities have charged the brother of fallen hedge fund billionaire Raj Rajaratnam with participating in his insider dealing scam.
Rajarengan Rajaratnam, younger brother of the Galleon hedge fund boss, now lives in Brazil and the US is likely to press for him to be extradited to face the charges. The indictment comes as a deadline to bring charges for securities violations approached.
Rajarengan, 42 and known as Rengan, was mentioned on numerous occasions during his brother’s trial in 2011, the largest insider-dealing trial in US history.
Rajaratnam was convicted in 2011 of earning up to $75m illegally from insider tips. He is now is serving an 11-year prison sentence. Rengan Rajaratnam has been charged with conspiracy to commit securities fraud and six counts of securities fraud.
“Along with his brother, Rengan Rajaratnam was allegedly at the heart of an insider trading scheme that swept up an unprecedented number of people in its web of corruption,” Manhattan US attorney Preet Bharara said in a statement.
So far the US authorities investigation of the Galleon Group has resulted in more than two dozen convictions, including Rajat Gupta, a former Goldman Sachs director and boss of the McKinsey management consultant. Several former Galleon traders are now cooperating with the authorities.
At trial it emerged that Rengan had been trading in a fund that held shares of tech firm Clearwire ahead of a deal with chip giant Intel. The court heard that Raj Rajaratnam had been given inside information by Rajiv Goel, an Intel employee and former classmate of his at the University of Pennsylvania’s Wharton School.
After the Wall Street Journal broke news of the deal Rengan Rajaratnam called his brother. In a conversation taped by the FBI he said: “Oh dude, we’re fucked.”
“It just hit the Wall Street Journal.” He said: “I don’t know how much you got in today, but I think it’s gonna rip tomorrow.”
Raj Rajaratnam’s lawyers argued lawyers had taken the conversation out of context. Rengan Rajaratnam’s lawyer was not immediately available for comment.
Category : Business, World News
A major hedge fund, SAC Capital, agrees to pay a record $614m (£406m) to US regulators to settle charges of insider trading.
Read the original: Fund pays $614m over insider trading
Also: Spotting insider trading for dummies. And Steven Rattner’s reemergence.
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Category : Business, World News
An employee from fund manager Schroders is arrested along with four other people in connection with a Financial Services Authority insider dealing investigation.
Read the original: Schroders trader among arrests
The men are the latest scalps in the government’s ongoing insider trading crackdown.
Read the original post: Two fund managers guilty in latest insider trading case
Category : Business
It might seem like the Netflix case is very different from an insider trading case. But selective disclosure and insider trading are birds of a feather.
See more here: Why Netflix got into hot water