Frank A. Rubino, ESQ.

FEDERAL AND INTERNATIONAL CRIMINAL DEFENSE

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Man Expected to Plead Guilty to Insider Trading

A man who is accused of more than $32 million of insider trading is expected to plead guilty this week. Terms of a plea agreement regarding the white collar criminal charges against him have not been released. Federal prosecutors had charged the man with gathering inside information from a corporate lawyer, through a middle man, and using that information to make millions. He allegedly obtained information regarding pending merger agreements that had not yet been announced. Those agreements included the purchase of Sun Microsystems by Oracle Corp., as well as the purchase of Omniture Inc. by Adobe System Inc. Each deal netted him millions of dollars, according to prosecutors.

Prosecutors previously arrested the middle man, who eventually plead guilty and worked with the prosecution to expose the other parties. After agents from the Federal Bureau of Investigation and the Internal Revenue Service searched his home, he worked with prosecutors to gather evidence against his co-conspirators.

After initially pleading not guilty, the trader has now apparently had a change of heart. A hearing is scheduled in the criminal case for him to change his plea. Depending on the specifics of his plea agreement, he may face a lengthy prison term, as well as heavy fines in connection with his activities.

A defendant needs to think carefully and seek the advice of a knowledgeable professional before agreeing to plead guilty. While the federal government has devoted fewer resources to this type of prosecution recently, insider trading and other financial crimes can still expose an accused person to serious consequences.

Source: The Wall Street Journal, "Guilty Plea Expected in Insider-Trading Case," by Chad Bray, 8 December 2011

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Coral Gables Office

Frank A. Rubino, Esq.
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