Goldman Banker in Calif. Said to Be Target of Insider Probe

Thursday, 26 Apr 2012 04:15 PM

 

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Goldman Sachs Group Inc. banker Matthew Korenberg in California is under investigation for insider-trading related to Galleon Group LLC co-founder Raj Rajaratnam, a person familiar with the matter said.

Federal prosecutors in Los Angeles are investigating Korenberg, a banker at Goldman Sachs’s San Francisco office, and Paul Yook, a former Galleon employee, for insider-trading involving transactions in the health-care industry, said the person, who didn’t want to be identified because the investigation isn’t public.

Federal prosecutors in New York this month said that a Goldman Sachs employee was under investigation for passing illegal tips to Rajaratnam. It was at least the third person at the New York-based bank to be tied to a probe related to Rajaratnam and former Goldman Sachs director Rajat Gupta. The existence of the California investigation was disclosed in court proceedings involving Gupta’s prosecution for allegedly passing tips to Rajaratnam. Gupta has pleaded not guilty and faces trial next month in Manhattan federal court.

Since 2009, insider-trading and securities fraud charges have been filed against at least 64 people in the U.S. investigation. At least 59 people have either pleaded guilty or been convicted at trial. They include Rajaratnam, who is serving an 11-year prison term.

Korenberg didn’t immediately return a call to his office seeking comment on the investigation. The probe was reported earlier by the New York Times.

Yook didn’t immediately return a call to a number listed under his name in New York. Laura Eimiller, a spokeswoman for the Federal Bureau of Investigation in Los Angeles, declined to comment, citing bureau policy not to comment on existing or non- existing investigations.

Goldman Sachs named Korenberg on a list of 272 managing directors in November 2009.

© Copyright 2014 Bloomberg News. All rights reserved.

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