NEW YORK (Grant McCool) - Three former securities traders were convicted on Monday on all counts of fraud and conspiracy to commit insider trading on pending mergers, in another victory for prosecutors in their probe of suspicious trading on Wall Street.
Brothers Zvi Goffer and Emanuel Goffer and a third trader, Michael Kimelman, their former partner at trading firm Incremental Capital LLC, chose to go to trial when dozens of other insider trading defendants in the broad probe have pleaded guilty.
The case is part of a wide-ranging insider trading investigation focused on hedge funds and traders, a probe marked by the use of FBI wiretaps. The central defendant in the government's probe is Galleon Group hedge fund founder Raj Rajaratnam, who was convicted last month of insider-related charges, also in Manhattan federal court.
A jury convicted Zvi Goffer, 34, a former Galleon Group trader, of two counts of conspiracy and 12 counts of securities fraud for activities between 2007 and 2009.
Prosecutors said he was a ringleader who paid cash bribes to two Ropes & Gray lawyers to learn what corporate deals the law firm was working on. The lawyers, Arthur Cutillo and Brien Santarlas, have pleaded guilty to criminal charges.
Emanuel Goffer, 32, was convicted on one conspiracy charge and two securities fraud counts. Kimelman, 40, was found guilty of conspiracy and two counts of securities fraud. Kimelman had rejected a plea deal soon before the trial began on May 16.
The jury found that the men traded on advance knowledge about pending mergers involving computer network equipment maker 3Com Corp and Canadian drug company Axcan Pharma Inc.
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