Indian charged in US’ biggest insider trading case

An Indian-American is among four persons charged by US authorities as part of a wide-ranging investigation involving the multi-billion-dollar Galleon Group hedge fund scam, the biggest insider trading case in the US. Sunil Bhalla, a senior executive with Polycom, along with three others was named in fresh charges filed by the US Securities and Exchange Commission  (SEC) on Monday.

Out of the four charged in the case, the SEC alleged, Robert Feinblatt, a co-founder and principal of New York-based hedge fund investment adviser Trivium Capital Management LLC, and Trivium analyst Jeffrey Yokuty engaged in insider training in the securities of Polycom, Hilton, Google and Kronos. Bhalla along with Shammara Hussain, an employee at investor relations consulting firm Market Street Partners that did work for Google, tipped the inside information that enabled the insider trading by Feinblatt and Yokuty on behalf of Trivium’s hedge funds for illicit profits of more than $15 million.

The action against the four individuals “reveals disturbingly corrupt arrangements – faithless company executives who secretly pass corporate information to hedge fund managers willing to violate the law for profit,” said Robert Khuzami, director of the SEC’s division of enforcement. “Market participants need to understand that by engaging in such behavior they invite SEC scrutiny, and we will uncover their conduct and take aggressive action,” he said.

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