Justices to weigh limits on insider trading cases
WASHINGTON (AP) — The Supreme Court signaled Tuesday that it could make insider trading cases harder to prosecute nationwide, dealing another blow to federal prosecutors.
The justices said they would hear the appeal of an Illinois man who is serving a three-year prison term after being convicted of trading on leaked inside information.
The court decided to take on the appeal of Bassam Yacoub Salman over the opposition of the Justice Department and a little more than three months after the justices sided against federal prosecutors who wanted to reinstate similar convictions in New York against two high-profile hedge fund managers.
The Justice Department had warned that warned that overturning the convictions could hinder the government’s campaign to curb insider trading on Wall Street, a crackdown that has resulted in more than 80 arrests and 70 convictions over several years. But that argument made no headway at the Supreme Court in October.
Salman was convicted of 2013 of making investments based on confidential information he received from a member of his extended family who worked in the health care investment banking group at Citigroup Global Markets in New York.
Prosecutors said Salman was part of a $5.3 million insider trading scheme that involved the investment banker, Maher Fayez Kara, of San Carlos, California, and other family members. Kara pleaded guilty to conspiracy and securities fraud charges.
Responding to Salman’s Supreme Court appeal, the Justice Department said there was no reason to take up his case after denying the government’s appeal in October.
The justices offered no elaboration on their decision to hear the case.
It is not clear whether arguments will take place in April or wait until the court’s new term begins in October. Salman is supposed to be released from federal prison in July.
The case is Salman v. U.S., 15-628.