November 05, 2009

The U.S. Department of Justice has filed criminal charges against 7 additional people for their alleged involvement in a continuing investigation into insider trading.

The latest charges include current and former employees at Galleon Group as well as Incremental Capital and the law firm Ropes & Gray. The charges focus on insider trading activities around mergers and acquisitions.

Those charged are Zvi Goffer, Arthur Cutillo, Jason Goldfarb, Craig Drimal, Emanual Goffer, Michael Kimelman and David Plate.

According to the charges, Goffer, a former Galleon and Schottenfeld employee, allegedly oversaw the insider trading by obtaining nonpublic information about planned mergers and acquisitions by several companies.

Goffer would leverage that information to profit from transactions and also provide inside information to other conspirators. The allegations point to insider trading suspected in the 2007 acquisition of Avaya when the company merged with Silver Lake and TPF Capital, which were advised by Ropes & Gray. Other acquisitions include Kronos and Hilton Hotel Corp.

These arrests bring the total to 14 following last month’s charges against Raj Rajaratnam, founder of Galleon Group, and others in the $20 million case.