FOX Business Network (FBN) senior correspondent Charlie Gasparino reports that government officials are trying to get former SAC Capital portfolio manager Mathew Martoma 'to flip against' the fund company’s founder Steve Cohen on insider trading allegations.
Excerpts from the report are below:
On government officials attempting to 'flip' Mathew Martoma against Steve Cohen:
'Government officials had high hopes that Mathew Martoma, the latest former executive from SAC Capital to be implicated in the government’s burgeoning investigation of insider trading, could provide evidence that would finally implicate the probe’s ultimate target: Steve Cohen, the fund company’s billionaire founder. But people close to the investigation say Martoma has refused past attempts to provide evidence against his old boss and at least for now shows no signs of giving into to the government’s demands. And they say Martoma has a powerful incentive not to cooperate because SAC, which hasn’t employed him for about two years, is now paying for his high-profile, and highly paid attorney, Charles Stillman'.
On Martoma’s legal fees
'People who know Stillman say his fees aren’t cheap - his rate is as much as $1,300 a hour, they say. And while it is not unusual for companies to pay the legal defense of executives ensnared in criminal and civil probes based on standard employment contracts, legal experts say the practice always prompts the question of whether the firm is really paying for silence… But it’s unclear if the legal-fee arrangement is part of Martoma’s employment contract, or part of some other recently crafted deal with SAC. Martoma hasn’t worked at SAC since 2010, when he was fired for poor performance. He earned $9.4m in 2008, a bonus prosecutors say was based on using inside information on trades'.
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