Although this excuse has previously be used as a defence for plagiarism this is the first time I have seen such a defence used for "insider trading".
The judge said she was ``mystified'' why the couple, both ``classic overachievers'' raised in China, would trade on inside information. Wang's lawyer, Catherine Redlich, said there may have been a ``cultural'' basis for the crime.
The defence lawyer then stated:
``In the People's Republic of China, insider trading is only rarely, and not until very recently, prosecuted as an offense,'' Redlich said.
This story gives us an insight into the behaviour of the Chinese stockmarket and to me is another bear signal. The Chinese stockmarket is a sell at current levels in my opinion. With corruption clearly rife, current share prices resemble of classic ponzi scheme.
Ex-Morgan Stanley, ING Couple Sentenced to Prison [Bloomberg]
Dec. 4 (Bloomberg) -- An Ex-Morgan Stanley vice president and her husband, a former ING Investment Management analyst, were sentenced to 18 months in prison as a judge assailed the ``pure greed'' that drove them to trade on secret stock tips.
U.S. District Judge Colleen McMahon in New York today turned aside a request by Jennifer Wang, of Englishtown, New Jersey, that she get probation so that she may care for her infant son. Wang and her husband, Ruben Chen, faced as long as 37 months in prison after admitting in September that they made $611,000 through three trades based on inside information.
``A clear message does need to be sent to everyone who works in this industry,'' McMahon said. ``You are both culpable. You are both going to do prison time.''
U.S. prosecutors this year have stepped up efforts to combat insider trading. A former Bear Stearns Cos. broker last week became the ninth person to plead guilty in a wide-ranging insider case that also involved UBS AG and Morgan Stanley employees. In August, a former Goldman Sachs Group Inc. associate pleaded guilty to making more than $6.7 million through illegal trades.
McMahon ordered the couple to pay $611,000 in restitution. She staggered the couple's prison terms, ordering Wang to prison after Chen completed his sentence.
The judge said she was ``mystified'' why the couple, both ``classic overachievers'' raised in China, would trade on inside information. Wang's lawyer, Catherine Redlich, said there may have been a ``cultural'' basis for the crime.
Rarely Prosecuted
``In the People's Republic of China, insider trading is only rarely, and not until very recently, prosecuted as an offense,'' Redlich said.
``Pure greed,'' McMahon replied. ``That's all I'm left with.''
Wang and Chen were arrested in May for trading in the securities of Town and Country Trust, Glenborough Realty Trust and Genesis Health Care based on information Wang learned from New York-based Morgan Stanley. They made their illegal trades from December 2005 to March 2007.
According to the government, Morgan Stanley was advising its Morgan Stanley Real Estate unit on the acquisition of both Town and Country and Glenborough. Wang learned about the firm's failure to acquire Town and Country and the successful purchase of Glenborough before the transactions became public and tipped her husband to the news.
``The people who committed this crime, like most criminals, didn't believe they'd get caught,'' Assistant U.S. Attorney Reed Brosky told McMahon at the sentencing hearing. ``That's a sad reflection on our society and Wall Street.''
`Take the Fall'
Wang and Chen each pleaded guilty to one count of conspiracy and three counts of insider trading. Chen, a former hedge fund analyst, had asked to be sentenced to 30 months in prison.
McMahon said she wouldn't permit Chen ``to take the fall'' for his wife, who was ``more culpable.''
``You are a thief,'' McMahon told Wang.
The couple was arrested on the same day that Randi Collotta, a former Morgan Stanley compliance officer, pleaded guilty to insider-trading charges. Collotta was sentenced to probation and 60 days in custody on nights and weekends. Her husband, who also pleaded guilty in the case, was sentenced to six months of home-confinement.
Redlich cited ``the other Morgan Stanley couple case'' when she sought probation for Wang.
Neither defendant spoke during the sentencing.
Representatives of ING Groep NV, the largest Dutch financial-services company, and Morgan Stanley have said their firms cooperated with federal investigators.
The case is U.S. v. Wang, 07-cr-730, U.S. District Court, Southern District of New York (Manhattan).
.
No comments:
Post a Comment