April 24, 2014
NEW YORK: Preet Bharara's perfect record, 80 insider trading convictions without a single defeat, is in jeopardy.
The US court of appeals in Manhattan on Tuesday picked apart the government's case against two former hedge fund traders, Todd Newman and Anthony Chiasson, questioning whether the judge in the trial erred when instructing jurors.
April 24, 2014
NEW YORK: Preet Bharara's perfect record, 80 insider trading convictions without a single defeat, is in jeopardy.
The US court of appeals in Manhattan on Tuesday picked apart the government's case against two former hedge fund traders, Todd Newman and Anthony Chiasson, questioning whether the judge in the trial erred when instructing jurors.
In an hour-long hearing, a three-judge panel hinted that it might overturn the convictions, the first real threat to Bharara's sweeping campaign as a US attorney to root out insider trading on Wall Street. The prosecutor arguing the appeal for Bharara was on the defensive from the start. Before Antonia M Apps even finished a sentence of her presentation, the appellate panel implied that Bharara's office had steered some insider trading trials to Judge Richard J Sullivan, a lower-court judge in Manhattan. Judge Barrington D Parker of the appeals court, interrupting Apps, referred to Judge Sullivan as the government's apparent "preferred venue" for insider trading cases.
While Apps argued that consolidating the cases created "judicial efficiencies," Judge Ralph K Winter noted the "sheer coincidence that the judge who bought into the government's theory" oversaw the recent trials.
It is not every day that Bharara's office is challenged over its Wall Street crackdown. Bharara, a 45-year-old former aide to Senator Charles E Schumer, Democrat of New York, has seen his celebrity status rise with every case against a big bank or hedge fund. As his profile grew, Bharara appeared on the cover of Time magazine and fielded speculation about a run for public office. Even Bruce Springsteen — Bharara is a big fan — name-checked him at a concert. A judicial chiding here or there will not slow his momentum, and legal experts said the appellate court could very well uphold the insider trading convictions. A reversal, however, might undercut one of his greatest achievements.
A victory for Chiasson and Newman would offer a blueprint for traders to defend future insider trading cases and would imperil at least one other milestone conviction: Michael Steinberg, of SAC Capital Advisors, the once-giant hedge fund that Bharara indicted last year.
Courtesy: NY Times
