Another Arrest Made In Insider Scam

Jason Smith, 29, was arrested at his New Jersey home by US authorities after serving on a federal grand jury investigating in 2003 into possible accounting fraud at Bristol-Myers Squibb. He is accused of tipping off former school mate, David Pajcin, one of two former Goldman Sachs employees embroiled in the affair, to sell the company shares short. It is also alleged that he gave Pajcin and Eugene Plotkin, the other former Goldman staffer, $7,000 for an account established to fund their insider trading 'business'.

The two former Goldman boys stand accused of engineering a variety of ambitious schemes to obtain price-sensitive information and illegally trade. Stanislav Shpigelman, a mole at Merrill Lynch, has been charged with passing on confidential information about future M&A deals his firm was working on. The'plot' also includes appearances from a Croatian seamstress and an exotic dancer. Pajcin and Plotkin are also accused of hiring someone to go work in the warehouse which printed 'Business Week', and arranged for him to steal advance copies of the magazine, so that they could purchase shares tipped in the publication's pages.

Smith is now the 14th defendant in this case, and is currently being held on $3m bail. If convicted, he could face up to 45 years in prison.