Newsletter #369 (View other news stories)
Forklift operator gets probation in stock scheme
NEW YORK, NY, United States
Wednesday, 16 Jul 2008
A judge has sentenced former forklift operator Juan Renteria Jr. to two years’ probation and ordered him to forfeit USD5,000 in illegal profits from an insider trading scheme.
US District Judge Richard J Holwell said Renteria admitted guilt and co-operated with federal authorities in identifying the leaders of a creative scheme involving more than a dozen people in the US, Croatia and Germany. Initially, Renteria entered a not guilty plea to charges of fraud and insider trading (Forkliftaction.com News #287).
At the sentencing in New York, Renteria apologised for his actions and said he would regret them for the remainder of his life. Because of his co-operation, Renteria, 22, was spared time in prison.
The scheme involved theft of pre-release copies of BusinessWeek magazine so traders could profit from security transactions based on tips in the magazine’s "Inside Wall Street" column.
Printing firm Quad/Graphics Inc in Hartford, Wisconsin hired Renteria at age 19 after he responded to an advertisement for work as a US$10/hour forklift operator. Subsequently, perpetrators of the scheme offered him money to forward early copies.
Purported ringleader Eugene Plotkin, 29, formerly an analyst with Goldman Sachs Group Inc, was sentenced in January to four years and nine months in prison and ordered to forfeit USD6.7 million. David Pajcin, a former Goldman Sachs trainee, and Stanislav Shpigelman, an analyst in mergers and acquisitions at Merrill Lynch & Co, pleaded guilty and cooperated with the government in return for lighter sentences.
The scheme began in 2004 and was disclosed in April 2006 after regulators learned Pajcin’s aunt, a retired seamstress in Croatia, had received payments of more than USD2 million.
Agents of the US Securities & Exchange Commission and the US district attorney’s office in New York conducted the investigation.
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