Another Goldman Sachs Employee Named In Insider Trading Probe: Reports

Federal investigators are reportedly looking into whether a Goldman Sachs employee fed inside information to Raj Rajaratnam's Galleon Group

Another Goldman Sachs name has been connected to the investigation of insider trading at defunct hedge fund Galleon Group.

Federal prosecutors and Securities and Exchange Commission officials are reportedly looking into whether a senior Goldman investment banker, Matthew Korenberg, fed inside information to a Galleon Group portfolio manager named Paul Yook, according to separate reports in the New York Times and the Wall Street Journal.

Investigators are said to be looking into whether Korenberg, who was based in California, passed non-public information to Yook about pending healthcare industry mergers -- including the 2009 Abbot Laboratories acquisition of Advanced Medical Optics. Korenberg has not formally been accused of any wrongdoing, the Times reports.

“For more than two years, the government has pursued an investigation with nothing to show for it,” Korenberg's attorney told the NYT. “There has never been any allegation of any tipping or insider trading by Matt Korenberg.”

The inquiries are part of an ongoing, three-year investigation into alleged insider trading activities involving Galleon. The hedge fund closed in October of 2009 after the firm's founder, Raj Rajaratnam and a number of his colleagues, were arrested on insider trading charges.

This past October, Rajaratnam was convicted and sentenced to 11 years in prison. Since then, the investigation has continued as federal officials seek to find who, outside of Galleon, was part of an alleged network of conspirators offering inside corporate information to Rajaratnam for use in his trading activities.

So far, three Goldman Sachs employees -- Korenberg, a salesman named David Loeb and a technology stock analyst named Henry King -- have come under scrutiny, as the Times points out. What is still unclear is whether other Goldmanites were involved too.

Last month, at a pre-trial hearing for Rajat Gupta (the former McKinsey & Company executive and Goldman director who is on trial for allegedly feeding inside information to Galleon), Gupta's lawyer told the court that a different Goldman employee was feeding Rajaratnam confidential tips about Intel Corp. and Apple, though he did not identify the person in question. It is unclear whether that person is one of the three named Goldman employees under scrutiny.

Last week, it also emerged in a pre-trial hearing that federal prosecutors in California were looking into whether a different Goldman executive leaked inside information about two companies to Galleon, as the Times reported. It is still not explicitly clear whether the employee mentioned last week is one of the three already named Goldmanites or whether it is also a separate person.

Gupta's defense could be bolstered by the suggestion that there were other contacts inside Goldman feeding inside information to Rajaratnam, the NYT points out.

Comments

[thelifeofbrian]

10:01 AM on 04/28/2012

These are but the very first pebbles to have fallen from the coming avalanche.

[irishkids1234]

02:24 PM on 04/27/2012

Is GS the biggest bunch of dirty dogs on Wall Street? These guys are major players in the mess that they created for all of us. Their "graduates" populate vital areas of government....remember Paulson. They are shameless and have enough legal firepower to never pay for their illicit deeds. They are dispicable, greedy, low-lifes. The SEC is a gutless puppet of this outfit. Politicians can't deal with them, they are too entrenched. They are the embodiment of Gordon Gekko's idea of greed.

[ivanczar]

01:57 PM on 04/27/2012

Goldman Sachs is too corrupt not to fail .

[queensews]

01:47 PM on 04/27/2012

Is it even possible to rid the world of these cretins??? They've been financially raping this country fro years now, and I think it's time for someone in the higher-ups to go to jail and the rest will follow.

[vigoddess]

01:31 PM on 04/27/2012

The biggest mistake President Obama has made in his term of office was
not getting the Dept. of Justice to prosecute Goldman Sachs and the
Banks who maniuplated Wall Street, and allowing these banks to continue
breaking the law, paying off, is no better than a bunch of gangsters owning
the country. The hardship alone these banks created, without a minute
of pause, knowing how they were hurting milliions of homeowners by
a scam for the God is Money club, and made that okay, they should have
been marched to prison, all in orange jumpsuits. No settlements.
People believe the government controls the money in the nation, but it's
the banks that control the money, and are throwing the nation into the
sewer. For what? Power?? Power over what? Like Haiti, a third world
nation on the backs of the poor?

[saksr1of3]

12:52 PM on 04/27/2012

Goldman Sachs is swirling in the toilet bowl with the other bankster gangsters, hoorah. Only a matter of time and the will crumble into dust!

[vigoddess]

01:39 PM on 04/27/2012

They will crumble into dust after we are ashes because that's what happened to
the Rise and Fall of the Roman Empire. After the banksters finished with dividing
the people into factions - green vs. blue, and burned all the poor people, so
society would only have an elite. Only crooks and wealthy. Familiar? Nature responded to that by an eruption of a volcano that spilled lava that covered the entire city of Rome,
and Etna is still spitting its message to this day. That resolved everything and
ended the most powerful country of its time.

[4me2knw]

12:40 PM on 04/27/2012

This possible second "dip" in the economy we've been hearing about lately? I've heard it's really the second phase of Wall Streets and the Banks money/land grab. They're set to make more huge profits off the American public. Time will tell if this true or not. Eventually it'll all come out in the wash. They will be exposed whether our government wants them to be or not. It might take 40 or 50 years (like most things in this country for our government to finally tell the truth about), until the crooks are all tucked away safe, but at some point in time, the truth will be known.

[smp276dp]

12:24 PM on 04/27/2012

That is old news huff. Come on get with it.
They were being investigated for over two years now.

[nypapajoe]

12:21 PM on 04/27/2012

Granted te Secret Service agents violated their trust and their oath but it's a victimless crime and they do have internal affairs and other investigative agencies that respond to these incidents! Why doesnt this same congressional and senators committees jumbling all over these "Violations" investigated instead those politicians and Wall St Banking thieves that have bankrupted our nation and have put millions out of work, homes and are going hungry? Why don't they jump swiftly on this calamity or is it that they won't because it's their fellow buddies? Hummmmmmm!

[4me2knw]

12:21 PM on 04/27/2012

The planning and scheming must of started in 2007. It's 2012. That's 5 years and the feds are just now "probing" these crooks? The feds are part of it too. Our Secretary of the Treasury is an Ex Goldman Sacs employee as well as a few other high positioned government employees. What a massive scam. How can our government begin to investigate this when it could implicate them?

[Bigwave48]

10:04 AM on 04/27/2012

Recently 60 minutes did a piece on the Regulators , who were in charge of watching over
these Wall Street investors. These Regulators, had an office right in the building of these
big banks, They literally were in the building, and had full knowledge of the worthless
instruments, these guys were selling. The fact that these CEO's new how worthless the
paper was,
, was in it self fraud, the Regulators did nothing. The governments involvement in the
financial meltdown, can't be ignored. Not until we get a Congress , that is willing to
pass legislation, taking the power of printing money away from the Federal Reserve,
we will never be safe, from Banking Fraud. The damage done by these banks, still
has not been revealed, but the amount is staggering,, it could equal the total
national debt.
When you hear a Senator saying Banking Regulations, must be repealed, you know
he is in there pocket......

[bldrpartnship]

09:55 AM on 04/27/2012

it must make their parents proud of the thieves they have become, when they look in the mirror someday I hope they see the lives ruined because of their greed

[mj1247]

09:02 AM on 04/27/2012

it's all about money and power for the elite in this country...like Sean.hanity says you can eat beans and rice (with a little cheap meat) and have a good life..... while he dines on 350 dollar a bottle wine......

[thefacts22]

09:00 AM on 04/27/2012

It seems that some of the money that was missing from MF ended in Goldman Sachs

[Joel Harris]

08:54 AM on 04/27/2012

Goldman Sachs has the worst kind of human beings working there. You get a few crooks together in one room and the SCHEMES take off!!!

They have raped this country numerious occassions. I watched a report on a show called FRONTLINE, a new program that deals in facts and only facts. I learned the Goldman Sachs action a few years ago HAD A GREAT EFFECT on WALL STREET.

It could be argued that GOLDMAN SACHS's actions cost this country billions and billions of dollars more than all the other investment firml