From Businessweek: Craig Drimal never had a clue when he confided in David
Slaine about his trading on illegal tips that his former colleague would relay
the information to federal agents. And when Drimal passed Slaine a slip of
paper with symbols for four stocks that were “in play” as they lunched at a
Burger Heaven in midtown Manhattan, he certainly didn’t plan for it to end up
in a file at the FBI. The force of Slaine’s betrayal didn’t hit him until Nov.
5, 2009, when Drimal and 13 others where charged with insider trading. Drimal
pleaded guilty and last year was sentenced to 5½ years in jail. “He was
crushed,” says Arlene Villamia-Drimal, his wife and lawyer. “He believed David
was his friend.”
A former Morgan Stanley (MS) managing director and onetime
partner at the Galleon Group hedge fund, Slaine spent two years mining for
leaks while working undercover for the FBI. The evidence he gathered led
directly to the conviction of Drimal and 11 other people and indirectly to an
additional half-dozen convictions, according to court papers. His work also
helped prosecutors build a case against Galleon Group co-founder Raj Rajaratnam.
“Slaine’s cooperation has been nothing short of extraordinary,” Assistant U.S.
Attorneys Andrew Fish and Reed Brodsky wrote in court papers before Slaine, 53,
was himself sentenced this year on securities fraud and conspiracy charges…..
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