NEW YORK, April 25 (Reuters) - Attorney Matthew Kluger, who
pleaded guilty in December for his role in a $32 million insider
trading scheme, has agreed to pay $516,000 to settle the case,
the U.S. Securities and Exchange Commission announced Wednesday.
Kluger was accused in April 2011 of stealing confidential
information about clients at his former law firms who were
involved in mergers and acquisitions. He previously worked at
Cravath Swaine & Moore; Skadden, Arps, Slate, Meagher & Flom;
Fried, Frank, Harris, Shriver & Jacobson; and Wilson Sonsini
Goodrich & Rosati, and over an 11-year period stole client
information used in the illegal trades, prosecutors alleged.
Kluger passed along that information to a middle man, Kenneth
T. Robinson, who then passed it to stock trader Garrett Bauer,
the government claimed. Bauer was accused of using the
information to make fraudulent trades totaling $32 million, to
benefit all three men. Kluger, Bauer and Robison pleaded guilty
Bauer agreed to pay $31.6 million, Bauer will pay $32
million and Robinson will pay $845,000, according to Wednesday's
announcement by the SEC. They are scheduled to be sentenced on
June 4 in U.S. District Court for New Jersey.
Robert Khuzami, director of the SEC's Division of
Enforcement, said in a statement that the men "schemed to
outsmart law enforcement by structuring their relationships and
communications to avoid detection and frustrate insider trading
Neither Kluger nor his attorney could be reached for
The case is United States v. Bauer et al, U.S. District
Court, District of New Jersey, 11-03536.
For the prosecution: Judith Germano and Matthew Beck.
For Kluger: Alan Zegas of the Law Offices of Alan Zegas.
(Reporting by Leigh Jones; Additional reporting by Katya