Kudos to the U.S. prosecutors of financial crimes and to the agent who remembered wiretaps!
David Glovin, David Scheer and Bob Van Voris authored the article, “Galleon Insider Case Ushers in Wiretaps for Finance Prosecution“, for Bloomberg.com this morning. It tells the story of how U.S. prosecutors used wiretaps to gather evidence in an insider trading case against the founder of the hedge fund Galleon Group.
In the first sentence, the authors report U.S. prosecutors “said they will use similar tactics to fight future crimes on Wall Street.” But the kicker is this, “He (U.S. Attorney Preet Bharara) said the prosecution is the first time wiretaps have been used to target insider trading, calling the case “unprecedented.”
Hello?
That this is the first time prosecutors have used wiretaps against insider trading begs the question, “doesn’t a wiretap seem like an obvious tool for gathering evidence in insider trading cases?”
Those who lack integrity, possess insider information and are willing to share it are certainly crafty enough to know they can’t write it on paper or send it by email. Insider information is shared mouth to ear. It’s shared in the back seats of town cars. It’s shared over dinner. It’s whispered over the phone.
Of course, with the way the Feds are making a point of their new and unprecedented use of wiretaps, the fear of having one’s whisper numbers overheard by the FBI may help eliminate the sharing of insider information by phone.
It’s sad that it has taken all the way to 2009 for the Feds to use wiretaps against insider trading. Maybe the Madoff scandal was a wakeup call. However it happened, I’m glad the Federal prosecutors who battle financial crimes have discovered wiretaps.
I imagine those who share illegal financial information will wonder about every suspicious “click” in their phone calls. It may be more than a bad connection!
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