Insider Danielle Chiesi is on trial for actions that, according to Fortune, is “a confirmation of all (people have) suspected is wrong with Wall Street and the hedge fund industry”. Former IBM executive Bob Moffat and Danielle Chiesi have both been arrested and charged with securities fraud and conspiracy.
The story of Danielle Chiesi
Danielle Chiesi was an employee of the Galleon hedge fund, employed directly by Raj Rajaratnam, the founder of the fund. Danielle Chiesi traded mostly and primarily in data. Danielle Chiesi developed and maintained a “harem” of inside sources at various tech companies. Fortune reports that Danielle would develop these relationships by telling men that she loved “the three S’s – sex, stocks, and sports. Danielle Chiesi is a former beauty queen and sorority girl who was known on Wall Street as a significant seductress.
Danielle Chiesi’s accused Wall Street crimes
By gathering the details, Danielle Chiesi wasn’t breaking any laws… but by sharing the info and using it for personal gain, she was. The crime of insider trading is what Chiesi was allegedly doing – passing along inside details about stocks. Chiesi pleaded not guilty to the charges, and she is on trial right now.
The effects of insider trading
Understanding insider trading can be very difficult. The understanding that every person has the same info is the basis of a fair stock market. Trades are unfair when somebody making the trade has information about a business the public doesn’t know. In other words, people like Danielle Chiesi cheat the system. Martha Stewart was convicted of this exact same crime. Danielle Chiesi proves that even tight-lipped execs can be seduced out of details. Could the fact money could be this easily gamed out of the system inspire any kind of confidence in the system?
