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Primary Global Recruited From Publicly Traded Companies, Ex-Analyst Says
A former Primary Global Research LLC analyst told a jury his firm actively recruited employees at publicly traded companies to work as consultants so they’d pass detailed inside information to fund managers who were clients.
Bob Nguyen, 32, of Stockton, California, testified as a prosecution witness against James Fleishman, a former Primary Global executive on trial in Manhattan federal court for allegedly participating in an insider-trading scheme.
Nguyen supervised experts from technology companies who moonlighted at Mountain View, California-based Primary Global, which matches investors with specialists who provide insight into specific markets. He said that after the financial crisis of 2008, senior Primary Global officials urged staff to recruit from public companies. Fleishman was present for those meetings, Nguyen said.
“The financial crisis happened and we’re getting all these potential experts who aren’t working,” Nguyen said. “The message was we should be recruiting people who are at publicly trading companies,” he said. “The reason was, they said, they were ‘more insightful.’”
Assistant U.S. Attorney Antonia Apps asked Nguyen what he understood “more insightful” to mean.
“What I understood was that they’d be more useful and provide more data to clients,” he said.
Of the 15 people charged by Manhattan U.S. Attorney Preet Bharara’s office in the insider-trading probe of so-called expert networkers and fund managers, 12 have pleaded guilty. One, Winifred Jiau, a former Primary Global consultant, was convicted at trial in June of securities fraud and conspiracy. Fleishman is the second to go to trial.
The case is U.S. v. Nguyen, 11-CR-32, U.S. District Court, Southern District of New York (Manhattan).
To contact the reporter on this story: Patricia Hurtado in New York at pathurtado@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net
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