Aug. 13 (Bloomberg) -- Doug Whitman, founder of the hedge fund Whitman Capital LLC, took the stand in his own defense in his trial on insider-trading charges.
Whitman, charged with two counts of conspiracy and two counts of securities fraud, began testifying this afternoon after the government rested its case against him in U.S. District Court in Manhattan.
He opened by describing his background and career to the jury.
Prosecutors allege Whitman made almost $1 million for his Menlo Park, California-based hedge fund by trading on illegal tips about Polycom Inc., Google Inc. and Marvell Technology Group Ltd. The decision to testify leaves Whitman open to cross-examination from prosecutors.
Jurors in the trial, which began July 30, have heard testimony from three witnesses who pleaded guilty to passing tips to the hedge fund manager and are cooperating with the government. Prosecutors presented instant messages and telephone recordings they claim show Whitman traded on confidential company information.
If convicted, Whitman faces as long as five years in prison on each conspiracy charge and 20 years on each securities fraud charge.
The government rested its case today after presenting almost two weeks of testimony.
The final prosecution witness, a Menlo Park florist, Jeffrey Adair, testified that in July 2009 Whitman sent a $125 bouquet to Roomy Khan, a former consultant who testified that she passed illegal tips to Whitman on Google and Polycom.
A note accompanying the flowers read “thank you from whitman capital,” according to an order from Adair’s records.
Prosecutors claim Whitman sent the flowers to thank Khan for a tip on Google’s earnings that hadn’t been publicly announced.
The case is U.S. v. Whitman, 1:12-cr-00125, U.S. District Court, Southern District of New York (Manhattan).
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