Four people of Indian origin are among those charged in America's largest ever insider trading case replete with all the elements of a classic television crime drama - wiretaps, clandestine cash handoffs and people with nicknames like "the Greek" and "the Octopussy".
As outlined by federal prosecutors in New York on Thursday, a trader known as "the Octopussy" is at the centre of the ring which included two Indians, Deep Shah, a Moody's Investors Service analyst, and Gautham Shankar, a former proprietary trader at Schottenfeld Group in New York.
In all, 14 traders, lawyers and hedge fund executives were charged with conspiracy and securities fraud. Five of those defendants, including Shankar, have already pleaded guilty, while Shah is still at large.
Two other Indians, Anil Kumar and Rajiv Goel, were arrested last month along with Sri Lankan Tamil-origin billionaire Raj Rajaratnam, founder of the Galleon Group and hedge fund operator.
"When we announced our first arrests three weeks ago, I said this case should be a wake-up call for Wall Street," said US Attorney Preet Bharara Thursday. "Today the alarm bells have only grown louder."
In their investigation, authorities used sophisticated data mining and electronic surveillance tactics that are normally reserved for the pursuit of gangsters and drug traffickers.
{{/usCountry}}In their investigation, authorities used sophisticated data mining and electronic surveillance tactics that are normally reserved for the pursuit of gangsters and drug traffickers.
{{/usCountry}}Thursday's charges focus on a group of traders at the proprietary firm Incremental Capital. Zvi Goffer, the founder of that firm, who formerly worked at Galleon and Schottenfeld Group, allegedly organised a ring involving fellow Galleon and Schottenfeld trading colleagues and arranged to get tips on technology company deals through a lawyer from a major New York law firm.
Referencing a James Bond movie, Goffer was known to the group as "the Octopussy", authorities said, because he got information from many sources.
Borrowing tactics used by drug dealers, the three and others allegedly used difficult-to-trace pre-paid cell phones to communicate, and moved money in clandestine cash drops at various locations on the Upper East Side of Manhattan.
Authorities said they recorded calls in which the accused discussed companies they targeted with nicknames like "Apple" and the "Hilton hit," and principals in the scheme received monikers like "the Rat" and "the Greek".