A network of high-school buddies and former co-workers often
talked on the phone about the "Fat Man," and giving each other their
"vacation photos," but WSJ says, federal prosecutors say those were
code words used to disguise an insider-trading ring that lasted five years.
The group, which included three health-care execs, a
chiropractor and the owner of a spa-supply company called Yeah Baby, allegedly
made more than $1.7 million by passing on secret information about mergers and
acquisitions and earnings announcements of at least seven pharmaceutical
companies, according to prosecutors and the Securities and Exchange Commission.
According to a criminal complaint filed in Newark, N.J., by
U.S. Attorney Paul Fishman, the men allegedly used codes or incorporated secret
information in legitimate social conversations at basketball games, dinner with
friends or morning jogs. In one case, one member of the alleged scheme sent an
unindicted co-conspirator the number of a pay phone outside a Virginia K-Mart
store to communicate. They referred to at least one financial deal as the
"Fat Man," and used phrases like "fat man has a friend" and
"the fat man walks alone" to update one another on the status of the
deals, according to the complaint. The words "I have some vacation
pictures for you" were allegedly used to refer to cash payments made to
tippers in amounts ranging from $500 to $10,000 at a time….
Read all about it at http://online.wsj.com/article/SB10001424127887323353204578129263925148902.html?mod=WSJ_hp_LEFTWhatsNewsCollection
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