Federal prosecutors in New York are in the advanced stages of an extensive insider-trading investigation that could lead to criminal charges against Wall Street traders and executives, federal law enforcement officials said Saturday.
Authorities had been preparing to file charges in the probe within weeks, but that timetable could be accelerated after an article about the investigation appeared in The Wall Street Journal on Saturday, the officials said.
The investigation, conducted by the U.S. attorney’s office in Manhattan and the FBI, has been underway for several years and extends far beyond Wall Street to financial offices across the county, the paper reported.
Officials would not discuss specific companies or individuals under scrutiny or provide further details. The Securities and Exchange Commission is conducting a parallel civil probe, officials said.
The Journal reported that authorities are investigating bankers at Goldman Sachs in particular who might have given confidential information about health care mergers to certain investors. Goldman is the top provider of investment banking services in health care deals. A Goldman spokesman declined to comment.
The Journal also said that prosecutors are examining consultants with industry expertise who might be providing confidential information to hedge funds and mutual funds.
The story said one subject of the probe is Primary Global Research, a Mountain View, Calif., firm. Chief executive Unni Narayanan said in an interview: “We have no insight into what the government is investigating. All we know is Primary Global Research is not a target.”
Representatives for the U.S. attorney in Manhattan, Justice Department and SEC declined to comment.
Federal authorities, including U.S. attorneys and the FBI, have been pouring resources into probing what one senior federal law enforcement official called “rampant” illegal insider trading.
Officials say they are facing new challenges detecting, investigating and prosecuting abuses given the speed and complexity of the financial markets and a burst of new electronic media over which traders can communicate.
Last month, former Countrywide chief executive Angelo Mozilo agreed to settle insider trading and other charges by agreeing to pay $67.5 million.
