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Mon February 3, 2014
Jury To Get Insider Trading Case Of Matthew Martoma
Originally published on Mon February 3, 2014 7:43 am
RENEE MONTAGNE, HOST:
And a jury in New York is expected to begin deciding the fate of Matthew Martoma this week. A former portfolio manager at the hedge fund company SAC Capital Advisors, Martoma is accused of insider trading. Officials say he sold shares of two pharmaceutical companies after obtaining inside information about drugs being developed.
NPR's Jim Zarroli has more.
JIM ZARROLI, BYLINE: Martoma is one of eight SAC employees to be accused of insider trading. U.S. officials say he sold shares of two drug companies that were jointly developing a drug for Alzheimer's disease. In the process he made his firm a profit of $276 million.
The government says he sold the shares after learning that clinical trials for the drug had produced negative results. The government's star witness was Sidney Gilman, a prominent neurosurgeon who headed the committee that was reviewing the tests. He said Martoma persuaded him to divulge the data. Gilman says he lied to the FBI when he was first questioned about the disclosure because he was intensely ashamed of what he had done.
But the government's case was undermined somewhat when another witness testified that much of the information about the drug trials had already been disclosed to the public before the trades took place.
SAC, which was headed by Steven Cohen, was one of the most prominent and profitable hedge fund firms around. Cohen himself hasn't been charged criminally in the case, but U.S. officials say the investigation is continuing. Martoma could face 15 years in prison if he's convicted.
Jim Zarroli, NPR News. Transcript provided by NPR, Copyright NPR.