While stories of insider trading continuously populate the news, Jonathan Streeter ’90 visited campus last week to give his perspective as deputy chief of the criminal division of the U.S. Attorneys Office in the southern district of New York. As such, Streeter is the lead prosecutor in USA v Raj Rajaratnam et al., which has been called the biggest insider trading investigation in decades.
Rajaratnam is the Galleon Group founder who was convicted on all 14 counts of trading illegally on at least 19 stocks — involving large corporations such as Google, Goldman Sachs Group Inc., and Intel Corp. — and making upward of $70 million in profits. His conviction was in May and sentencing is scheduled for Thursday (Oct. 13).
Streeter’s team is arguing for one of the strictest punishments ever imposed for insider trading. In fact, on the morning of Streeter’s campus visit, he was in a Manhattan court arguing the case.
The conviction hinged on extensive wiretaps, a tool that investigators have found to be the most effective means of acquiring evidence for insider trading cases involving hedge fund managers.
“The U.S. Attorneys Office in Manhattan as well as the FBI in New York started to use the same techniques that have been used for years against the mafia and drug dealers,” Streeter told the audience. “There’s a lot of controversy around that, but that’s how we broke through this problem of prosecuting an insider trader at a hedge fund who does all this sophisticated trading that makes it very hard to make a case against him or her.”
Since joining the U.S. Attorneys Office in 2000, Streeter has had several high-profile victories, including last year’s conviction of the former CEO and CFO of Duane Reade on securities fraud charges and the conviction of attorney Marc Dreier on a $700 million Ponzi scheme. He told the students — many of whom are in the 51 Finance Club and the Pre-law Society — that he’s been interested in working on white-collar cases since his days as a student at Northwestern University School of Law.
Streeter said working on the Rajaratnam case was a “dream come true,” and that he believes it’s important to prosecute these cases to preserve the integrity of the marketplace.
“People’s faith that the stock market is essentially a fair place where people can compete fairly for information and trade on it is critical to the ability of the entire American economy to work,” he said.
After his talk, Streeter had dinner with students at the 51 Inn, where he gave more details on his career path, and offered some advice.
“It was interesting to talk to someone like that on a more personal level and ask him about his job as well as get his take on some cases,” said Zachary Amron ’13, president of the Pre-law Society.