Junior Goldman & Merrill Staff Arrested For Insider Trading
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According to the Securities & Exchange Commission (SEC) website, Plotkin and Pajcin were the masterminds behind audacious insider trading schemes which pulled in illegal profits of at least $6.7m. The two then Goldman staffers are alleged to have persuaded Shpigelman to provide tips on upcoming mergers in return for a share of trading profits. In one scheme, the former Goldman pair are accused of recruiting two individuals to obtain jobs at a printing plant in Wisconsin to steal advance copies of 'Business Week', and tip the bankers off about stock in companies being discussed favourably in the magazine ahead of publication.
Plotkin and Pajcin are also accused of contemplating several other schemes, including using exotic dancers to gather information while dancing with M&A bankers. In total, the pair are said to have traded in at least 25 stocks within a one year period based on information gathered in a variety of ways. The 'Business Week' scheme alone is said to have netted a cool $345,000 profit.
A spokesperson for the SEC said that 'our investigation uncovered one of the most widespread, varied and premeditated insider-trading rings we have ever prosecuted. This case demonstrates that despite all the advances in technology and electronic security, businesses remain as vulnerable as the people they employ'.
Goldman Sachs and Merrill Lynch will be mortified by what appears to have been uncovered.
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