Another one bites the dust.
Former SAC Capital Advisor portfolio manager Mathew Martoma was found guilty of insider trading on Thursday — bringing US Attorney Preet Bharara’s record in his five-year-old Wall Street probe to 79-0.
A jury of seven women and five men found the 39-year-old disgraced moneyman guilty of one count of conspiracy and two counts of securities fraud after deliberating for two-and-a-half days, ending the five-week trial.
Martoma showed no emotion as the verdict was read but tears were seen streaming down the face of his beautiful brunette wife, Rosemary — whose bright yellow sundress contrasted sharply with the gray winter Big Apple weather, and her mood.
“We are very disappointed and we are planning an appeal,” said Martoma lawyer Richard Strassberg.
Martoma remains free on bail pending sentencing.
“In the short run, cheating may have been profitable for Martoma, but in the end, it made him a convicted felon, and likely will result in the forfeiture of his illegal windfall and the loss of his liberty,” Bharara said in a statement after the verdict.
Martoma, 39, faces up to fives years in prison on the conspiracy count and up to 20 years on the fraud charges.
FBI Assistant Director George Venizelos, whose agents investigated Martoma and brought him to justice, said, “If material information isn’t public, you can’t trade on it. Today, Matthew Martoma found [that] out the hard way.”
Bharara’s probe has shaken the hedge-fund world and its relationship with so-called expert networks, where much of the inside tips originated. Six hedge funds — including SAC Capital — were shuttered by the probe.
Martoma is one of 11 inside traders ensnared in Bharara’s dragnet who’ve gone to trial — and the second from SAC.
Of the 78 prior convictions, seven were present or former SAC employees. Six pled guilty, as did the firm.
Martoma was charged with taking part in the most lucrative insider-trading crime ever committed.
Martoma’s illegal tips earned SAC $275 million in profits and avoided losses from inside information on drug trials of Elan and Wyeth. He got the tips from Dr. Sidney Gilman, who served as the government’s star witness.
The longest sentence that has been meted out in the insider-trading cases so far is for Raj Rajaratnam, the former head of hedge fund Galleon Group. He received a sentence of 11 years on Oct. 13, 2011.
In the far-reaching probe, charges are still pending against 11 individuals; 20 of those convicted have yet to be sentenced.
The other hedge funds that were put out of business by the insider-trading scandal include Galleon, Diamondback Capital, Barai Capital, Whitman Capital and Level Global.
Two expert network companies, Primary Global Research and Gerson Lehrman Group — which Martoma used — were caught up in the probe. Neither have faced charges and both are still in business.