Former Wall Street analyst and the founder of Indian online marketplace Shopclues.com, Sandeep Aggarwal, who was arrested by the FBI in San Jose for insider trading charges in July this year, has recently pleaded guilty for the same. Sandeep has accepted that he had passed on inside information about a deal involving Yahoo! Inc. and Microsoft Corp. to a former SAC Capital Advisors LP fund manager Richard Lee.
“I did this to improve my standing as an analyst and to increase revenue for my firm… I know what I did was wrong and I’m very sorry for my conduct,” said Sandeep.
Sandeep had a guilty plea hearing on November 8th. According to a report, talks with a defense lawyer were being held since September. “The parties have made substantial progress in our discussions,” wrote Assistant U.S. Attorney John J. O’Donnell.
Sandeep may have to pay a fine of over USD 5 Mn to get out of the situation. The final verdict of this case is expected in May 2014 before US District Judge Colleen McMahon. According to Bloomberg, he may be deported to India.
We have spoken to people close to Sandeep and they believed that he will be out of the situation in due time. Even the American insider trading law states that the first-time offenders are eligible to receive probation rather than incarceration.
A spokesman for the U.S. attorney’s office and Sandeep’s attorneys had declined to comment on the same.
Earlier, Sandeep was released on a bond of USD 500,000.
According to the court documents Sandeep was involved in a scheme from April 2008 to March 2010 for disclosing inside information regarding a partnership between Microsoft and Yahoo.
Sandeep was arrested by the FBI as part of the government’s probe of insider trading at hedge funds led by Preet Bharara. The Preet Bharara’s office has charged Sandeep with one count of conspiracy to commit securities fraud, and one count of conspiracy to commit wire fraud for passing along an inside tip about a pending deal. Sandeep spoke to about 14 traders or portfolio managers at various hedge funds about the Microsoft-Yahoo partnership.
Before getting into this situation, Sandeep was running a very successful online eCommerce company in India as CEO, which has recently been succeeded by Sanjay Sethi, who founded Shopclues along with Sandeep.
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