Guys, if you want to pass some insider “tiddie biddies” about major companies along to your friends you probably shouldn’t do it in writing.
David Loeb, a current Goldman Sachs managing director, exchanged emails with Raj Rajaratnam that included what he described as “tiddie biddies” about Apple, Intel and other technology companies, the Wall Street Journal reports.
It appears the two had an especially close relationship, according to the emails reviewed by the WSJ; Loeb affectionately referred to Rajaratnam as “Dr. RR” and “big daddie” and signed his emails “CBF” reportedly an acronym for "Chunky But Funky."
Dr. RR currently has his chunky self parked in prison. The Galleon Group hedge fund founder, was convicted of insider trading last year and is serving an 11 year sentence. Loeb is under FBI investigation for allegedly passing insider information about technology companies along to hedge funds. The e-mails indicate that the two were closer than previously thought.
Loeb’s relationship with Rajaratnam was a subject of controversy during the trial of Rajat Gupta, a former Goldman Sachs director who was found guilty earlier this month of passing secret information from Goldman board meetings to Rajaratnam.
One of Gupta’s key defenses -- which was based partly on a wiretapped conversation in which Loeb passed insider information to Rajaratnam -- was that Rajaratnam had other sources at Goldman for tips besides Gupta. Ultimately the judge excluded the tapes of the wiretapped conversations between Loeb and Rajaratnam from evidence.
The investigations into Loeb, Gupta and Rajaratnam are part of a widespread effort on the part of a variety of government agencies to crack down on insider trading by targeting high profile suspects. Still, it's unclear whether the convictions in the Gupta and Rajaratnam cases will do much to deter insider trading in the future.