Mathew Martoma, a former portfolio manager affiliated with SAC Capital Advisors and its billionaire founder Steven A. Cohen, pleaded not guilty Thursday to charges of insider trading.
Prosecutors said following Martoma’s arrest in November that his may be the largest case of insider trading in history, involving profits and avoided losses of $276 million.
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Martoma is accused of using illegal inside information to trade ahead of a negative report on testing of an Alzheimer’s disease drug. The information helped SAC profit from trading in shares of Elan Corp. (NYSE:ELN) and Wyeth LLC, according to prosecutors.
Cohen, one of the most high-profile U.S. hedge fund managers, was not named in the complaint but is described as “Portfolio Manager A,” who was said to have collaborated with Martoma as trades were made using the illegal information.
Martoma has reportedly refused to cooperate with prosecutors. FOX Business has reported that SAC Capital Advisors is apparently paying Martoma’s legal bills.
SAC issued a statement the day Martoma was arrested: “Mr. Cohen and SAC are confident that they have acted appropriately and will continue to cooperate with the government’s inquiry.”
Martoma is one of several former Cohen SAC employees to be ensnared in the government’s probe of insider trading.
Martoma’s plea was reported by The Wall Street Journal. Neither he nor his attorney could immediately be reached for comment.