Business

David Ganek, SAC’s Michael Steinberg ‘insider-trading’ co-conspirators: judge

Uncle Sam’s widespread insider trading crackdown just slimed two more investment bigwigs.

Manhattan federal judge Richard Sullivan yesterday ruled that SAC Capital money manager Michael Steinberg and Level Global co-founder David Ganek can be named co-conspirators in the current insider trading case unfolding downtown.

Neither Steinberg nor Ganek has been charged in the case, but the ruling lets prosecutors submit their e-mails and instant messages as evidence in their case against Todd Newman, a former portfolio manager at Diamondback, and Anthony Chiasson, Ganek’s former Level Global partner.

The feds have accused Chiasson and Newman of improperly profiting off insider tips on Dell and Nvidia.

Chiasson lawyer Greg Morvillo objected, saying that Chiasson’s former analyst Sam Adondakis, who pleaded guilty, testified that he never told Ganek he had an inside source at Dell.

Judge Sullivan said the evidence is “certainly circumstantial” but sufficient enough for the government’s request to be granted.

Sullivan cited the “precise information” Ganek had received leading up to Dell’s earnings as well as the “large trading positions” he authorized on the computer maker.

The judge relied on three e-mail communications to implicate Steinberg, one of which he said made “clear references to keeping things on the down-low and being extra sensitive.”

“I think it does indicate to me that it’s more likely than not that he [Steinberg] knew exactly where this information was coming from,” Sullivan said.

Ganek yesterday blasted the ruling as a “tactical skirmish between the defense and prosecution.”

“The key government witness, a former employee who I fired for violating our policies, testified multiple times that I didn’t know he was trafficking in insider information,” Ganek said.