Tags: Jack Abramoff | Wall Street | insider trading | Raj Rajaratnam

Abramoff: Lawmakers Took Part In Insider Trading

Friday, 11 Nov 2011 02:26 PM

About a dozen lawmakers and congressional aides allegedly took part in insider trading, bragging about how they were beating the market, claims disgraced former lobbyist Jack Abramoff.

Abramoff, who went to jail for his role in a corruption scandal, said those involved traded as little as $2,000 and as much as well into the six figures.

He didn't name names. "It was more, 'Look at me, I'm a real great stock trader,'" Abramoff tells CNBC.

"All of a sudden somebody from a background maybe in law, maybe in some other unrelated business area, all of a sudden is picking winners and losers in the market."

It seems those in Congress aren't necessarily subject to insider trading laws, however. Legal analysts say insider trading laws tend to target Wall Street firms.

But according to Abramoff, lawmakers were able to trade ahead of time knowing whether companies were going to be subject to investigations before they occurred.

"Hearings under almost every circumstance are going to have a bad impact on a company," Abramoff said. "And so some staffers I've seen in the past talking about the fact that, 'Oh, I'm gonna go out and short that company.'"

Insider trading has grabbed headlines recently on the heels of hedge fund manager Raj Rajaratnam's conviction and 11-year sentence.

The former financier must now pay $93 million in civil penalties, the Los Angeles Times reports.

"The penalty imposed today reflects the historic proportions of Raj Rajaratnam's illegal conduct and its impact on the integrity of our markets," says Robert Khuzami, enforcement chief at the Securities and Exchange Commission, the LA Times adds.

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About a dozen lawmakers and congressional aidesallegedly took part in insider trading, bragging about how they werebeating the market, claims disgraced former lobbyist Jack Abramoff.Abramoff, who went to jail for his role in acorruption scandal, said those involved traded...
Jack Abramoff,Wall Street,insider trading,Raj Rajaratnam
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2011-26-11
Friday, 11 Nov 2011 02:26 PM
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