Garrett Bauer stood in a New York University lecture hall and warned 150 students not to emulate him. The day trader recounted illegally making millions of dollars over 17 years using corporate merger tips stolen by an attorney.
Bloomberg reports that students stopped checking their iPhones and stared at Bauer, 44. He told how the lawyer, Matthew Kluger, searched law firm files for tips to pass to a middleman, Kenneth Robinson, one of Bauer’s closest friends. They escaped detection by talking on disposable, prepaid mobile phones. Their scheme unraveled after the Federal Bureau of Investigation persuaded Robinson to make secret recordings of conversations.
'I’m here hoping you won’t commit the same crime I committed, insider trading', Bauer told the students at NYU’s Stern School of Business in February. 'I feel remorse. That’s why I’m here. It’s my way of trying to apologize to everyone for what I’ve done and try to make amends'.
Bauer described Robinson’s betrayal, his own arrest and five-night jail stay in April 2011, and guilty pleas by all three men in one of the largest insider-trading cases of the past decade.
Bauer and Kluger, 51, are scheduled to be sentenced Monday by U.S. District Judge Katharine Hayden in Newark, New Jersey. Bauer faces nine to 11 years in prison under federal guidelines, and Kluger faces 11 to 12 years.
Hayden will decide whether Bauer deserves an 11-year term like that given to Raj Rajaratnam, the co-founder of hedge fund Galleon Group LLC convicted of insider trading last year.
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