A hedge-fund manager based in California was charged for insider trading last week. The accused, Doug Whitman, was reportedly involved in sharing information related to publicly traded firms. He also allegedly made big payments in exchange for tips. Mr. Whitman’s case stems from a probe on an insider trading case that involved the founder of Galleon Group, Raj Rajaratnam. He was convicted last year and is currently serving an 11 year imprisonment sentence.
Whitman Traded on Tips from Karl Motey and Roomy Khan
54 year old Whitman allegedly traded on tips that he received from Karl Motey and Roomy Khan. Both pleaded guilty for being involved in insider trading. They are cooperating with the government in an insider trading investigation. Miss Khan was Whitman’s neighbor in Atherton, California.
Since 2009, 63 people have been arrested in connection with insider trading cases. Out of them, 56 have pleaded guilty till now. U.S Attorney Preet Bharara stated that illegal shortcuts, corrupt collaborations and sharing inside tips are not the ideal ways to trade. People who don’t agree to this are bound to face consequences.
Whitman Pleads Not Guilty of Charges in Federal Court
Whitman surrendered last week to the agents of the Federal Bureau of Investigation. He pleaded not guilty at a hearing that took place in a federal court in Manhattan. His lawyer, David L. Anderson stated that Whitman is completely innocent of the charges brought against him. Whitman’s business is related to research and analysis so inside information was not obtained illegally. Insiders of firms were not paid for the personal benefit of the accused.