U.S. Builds Massive Insider-Trading Case Against Investing Pros

The government is about to spring the trap on people it alleges have engaged in insider trading. The case has been built over a three year period.

The Wall Street Journal reports, "The criminal and civil probes, which authorities say could eclipse the impact on the financial industry of any previous such investigation, are examining whether multiple insider-trading rings reaped illegal profits totaling tens of millions of dollars." Charges could be brought before the end of this year, according to the Journal.

The probe is focusing on people who made money by trading on information about corporate plans before they were made public to investors. So-called expert networks (which hire individuals with working knowledge of an industry or company to speak directly with traders and investors) are a part of the focus. The paper reports that "Among the expert networks whose consultants are being examined, the people say, is Primary Global Research LLC, a Mountain View, Calif., firm that connects experts with investors seeking information in the technology, health-care and other industries."

Potential leaks of information by Goldman Sachs Group (GS) investment bankers are also part of the investigation. Among other firms the government probed are Broadband Research and First New York Securities, according to the Journal.

The FBI and Justice Department spearheaded the investigations. The probe is not entirely finished and it is not clear when the first charges will be brought.

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joaquinabco

FRIENDS OF MADOFF DO WHAT?

November 22 2010 at 4:01 AM Report abuse rate up rate down Reply
Jean

Capitalism is the only system we have that encourages wealth. Why do Americans work harder than most other industralized nation - because we want more and we don't have the government control and high tax rates the European countries have. If we knew the government was going to cap our earning potential and impose outrageous taxes on our earnings, we would take 2-3 months vacation like the europeans. We need some government controls on companies monopolizing the market place and are preventing real competition. Years ago anti-trust laws and other laws were enforced which kept our market balanced. Special interest groups have successfully repelled these laws or diminished the enforcement of them so that we no longer have a true capitalist system.

November 21 2010 at 12:33 PM Report abuse rate up rate down Reply
1 reply to Jean's comment
jdrumerrnr

When Amanpour pointed to critics' claims that the very wealthy need tax cuts to spur business and capitalism, Buffett replied, "The rich are always going to say that, you know, 'Just give us more money, and we'll go out and spend more, and then it will all trickle down to the rest of you.' But that has not worked the last 10 years, and I hope the American public is catching on

November 22 2010 at 12:25 AM Report abuse rate up rate down Reply
grapost

Insider trading is as common as Illegal file sharing on the net. It happens everyday and has been going on since the beginning of the stock market. Remember Martha Stewart went to jail for trying to cover her tracks. It's like the Drug Trade and Gambling. The Feds only get the tip of the iceberg. It's just another way the rich use their influence and power to stay rich. You never hear of Rich People losing money in the stock market because they can PAY for the best inside information to make their investments. Anyone who thinks the Stock Market is a level playing field needs a Reality Check!

November 21 2010 at 9:18 AM Report abuse +3 rate up rate down Reply
2 replies to grapost's comment
bfpowersjr

grapost, I agree with you completely.

November 21 2010 at 12:08 PM Report abuse rate up rate down Reply
Delbert

Think politicians get rich in congress by good guesses?

November 21 2010 at 4:59 PM Report abuse rate up rate down Reply
bdzdean

Until such time as the FEDS and our justice system starts throwing these individuals in prison. Articles such as this make for interesting reading, and that's about all it is. Just something else to read.

November 21 2010 at 7:59 AM Report abuse +4 rate up rate down Reply
1 reply to bdzdean's comment
msw62msw

I agree completely. All we see is how the "FEDS" spend years (and millions in our taxes) "assembling cases". The result is almost always a plea bargain that lets the criminals keep the bulk of their thievery, and no jail time.

November 21 2010 at 8:44 AM Report abuse +2 rate up rate down Reply
pressmangary

TIME TO PUT U.S.GAS CHAMBERS BACK IN SERVICE,, LONG OVERDUE, RID THE PLANET OF THESE COCK A ROACHES..AND THERE FAMILY'S / FOR GOOD

November 21 2010 at 6:08 AM Report abuse +1 rate up rate down Reply
#####

I am sure it will only be token lip service , any 'punishment ' applied to these pig herders, the forces of darkness. The system behind the power won't bite the hands that feed it.

November 21 2010 at 4:51 AM Report abuse +4 rate up rate down Reply
1 reply to #####'s comment
msw62msw

Yep. The only 'result' will be the expenditure of millions of our taxes on more lawyers.

November 21 2010 at 8:45 AM Report abuse +2 rate up rate down Reply
Gumby

We should also investigate those herd mentality trading. Any idiot can give you examples of stocks being bidded up by herd mentality. Those stocks are already overvalued , yet they are still buying them. Many stocks are begging to be bought. Some stocks just keep on going like the Bunny with the stupid drum!!

November 21 2010 at 2:15 AM Report abuse +2 rate up rate down Reply
1 reply to Gumby's comment
bggdg

Maybe a law to prohibit purchasing stocks that have risen in value?

November 21 2010 at 7:07 PM Report abuse rate up rate down Reply
willi149s

There are pros trading on insider information and the Feds are going to get them...whoa...I bet that will stop them in their tracks and make them think twice, Barney's boyfriend mis-led the Feds and investors and his insider butty covered for him, doesn't get any more inside-er than that...can't wait for those indictments...

November 21 2010 at 1:03 AM Report abuse +4 rate up rate down Reply
1 reply to willi149s's comment
msw62msw

Yeah, they will have to 'pay back' 5% of their theft (meaning give it to the government) and the government and their lawyers will confiscate even more of our money.

November 21 2010 at 8:48 AM Report abuse +2 rate up rate down Reply
jdrumerrnr

CHARGES ON THE WAY? Feds Wrapping Up Massive Probe On Backroom Deals, Insider Trades

November 20 2010 at 11:50 PM Report abuse +4 rate up rate down Reply
MJ

Crash JP Morgan! buy physical silver!

November 20 2010 at 11:10 PM Report abuse +1 rate up rate down Reply