NEW YORK (AP) -- A man regulators call "the Octopussy" and six other white-collar defendants pleaded not guilty Tuesday in federal court in Manhattan to securities fraud charges in an insider trading case that has shaken Wall Street.
Prosecutors have billed the case as one of the largest insider trading cases ever and accused suspects of using drug dealer-style tactics to evade detection. So far, 21 people - including wealthy hedge fund whiz Raj Rajaratnam - have been charged. Eight have pleaded guilty.
Investigators relied heavily on wiretaps to make the case. On Tuesday, defense attorney Cynthia Monaco told the judge she was struggling to review 10,700 telephone calls that had been intercepted on the phone of her client, Zvi Goffer.
"The problem is the volume of the calls," she said.
All defendants remain free on bail.
At the center of the case is Rajaratnam, the portfolio manager for the Galleon Group hedge fund, who has been accused of pocketing as much as $50 million through a network of cheating executives at financial firms and companies privy to inside information. He denies wrongdoing.
Goffer, 32, of Manhattan, worked at Galleon Group for the first nine months of 2008 before he started his own trading firm, previously filed court papers said.
The Securities and Exchange Commission has put Goffer in a central role in the insider trading ring, claiming he was known as "the Octopussy" because of his reputation for having his hands on so many sources of information.
Court papers allege Goffer provided conspirators with prepaid cellular telephones so they could communicate in a way that reduced their chance of getting caught.
SEC officials say one suspect gave a man providing him inside information on a deal with a cell phone with two programmed phone numbers labeled "you" and "me." After the deal was announced, Goffer destroyed the cell phone by removing the electronic card that controlled it, biting it, and then breaking the phone in half and throwing it away.
Goffer and the six other defendants were ordered to return to court April 7.comments powered by Disqus