Former S.A.C. Capital Advisors LP portfolio manager Mathew Martoma was sentenced to nine years in prison for the most lucrative insider-trading scheme in history, in what might be the government's last hurrah in the investigation of billionaire Steven A. Cohen.
Mr. Martoma, convicted of making $275 million for S.A.C. by using illegal tips to trade in Elan Corp. and Wyeth LLC, rejected government offers of leniency in exchange for his cooperation in the probe of Mr. Cohen and his Stamford, Conn.-based hedge fund.
Mr. Martoma was the last of seven former analysts and fund managers from the firm to be convicted, closing a chapter in the pursuit of Mr. Cohen by Manhattan U.S. Attorney Preet Bharara. The S.A.C. investigation was part of a larger government crackdown on insider trading at hedge funds including Galleon Group, co-founded by Raj Rajaratnam.
Since August 2009, Mr. Bharara's office has charged 89 people with insider trading. Of that number, 81 were convicted, most through guilty pleas. Only one defendant, Raj Rajaratnam's brother, Rengan Rajaratnam, was found not guilty at trial. The remaining seven cases are pending.
U.S. District Judge Paul Gardephe, who handed down the sentence Monday in Manhattan federal court, ruled earlier that non-binding guidelines called for a term of more than 15 years to almost 20 years based on the amount of illicit profit, a term Mr. Gardephe said Monday was “far more than necessary.”