New York Man Sentenced in $37M Insider Trading Scheme
Newark, New Jersey. A former mortgage broker was sentenced Tuesday to 2 1/2 years in prison for being the middleman in a $37 million insider trading scheme that federal authorities said was one of the longest-running ever uncovered.
Kenneth Robinson’s sentencing in US District court came a day after his two co-conspirators received far lengthier sentences for their role in the 17-year conspiracy.
Former attorney Matthew Kluger, of Oakton, Virginia, received 12 years, the longest sentence ever handed down in an insider trading case. Former New York stock trader Garrett Bauer received nine years.
The three men admitted using advance information on company mergers provided by Kluger. Robinson, 46, of Long Beach, New York, knew both men separately and provided the connection between them.
Kluger admitted passing the information to Robinson, who gave it to Bauer. The trio made an estimated $37 million on trades from 2006 to 2011, according to court documents, which included $11 million on Oracle’s acquisition of Sun Microsystems in 2009.
Bauer’s attorney said in court Monday that his client made a profit of $22 million to $25 million when losses and taxes were factored in.
While the illegal trades charged in the criminal complaint date back to 2006, all three men pleaded guilty to conspiracy dating back to the mid-1990s when Kluger began working at a series of prestigious law firms and had access to privileged information.
The scheme unraveled in 2011 when FBI agents searched Robinson’s home. After that, he secretly recorded conversations with Kluger and Bauer for the government.