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In SDNY Long After Lavidas Guilty of Insider Trading Demane Debih Gets Time Served 5K1.1

By Matthew Russell Lee, Exclusive Patreon
Honduras - The Source - The Root - etc

SDNY COURTHOUSE, Dec 13 – Bryan Cohen, a Goldman Sachs banker charged with insider trading with the same cooperating witness as Telemaque Lavidas now on trial, on January 7 pled guilty to conspiracy to commit securities fraud, based on information from cooperator Marc Demane Debih. Inner City Press had it first.

  And on December 10, 2021, Judge Denise L. Cote gave Demane Debih a time served sentence, taking into account 15 months he spent incarcerated in Serbia and then New York - and the US Attorney's Office's 5K1.1 motion and letter. We aim to have more on this.

  On January 15, 2020 the jury found Lavidas guilty of insider trading, specifically of tipping George Nikas with insider information from Ariad Pharmaceuticals. Inner City Press said it would continue to cover the case - and it has.

  On March 8, 2021, Lavidas asked for permission to travel to Greece about "proposed new factory construction in Greece." He added he is putting aside $93,000 in case Marc Demane Debih doesn't pay his portion of the restitution.

On March 9, permission was granted. And now on April 20, this: "ORDER as to Telemaque Lavidas. The attorney for defendant Telemaque Lavidas having shown good cause in a letter dated April 20, 2021 that defendant be permitted to serve the remainder of his supervised release term in Greece, and there being no objection from the Government or Probation, it is hereby ORDERED that the request is granted. Defendant shall be subject to the same conditions of supervised release and shall comply with any and all requests by his probation officer. IT IS FURTHER ORDERED that defendant's letter dated April 20, 2021 shall be filed under seal. SO ORDERED. (Signed by Judge Denise L. Cote on 4/20/21)."

As noted, Inner City Press will stay on the case.

Previously:  "Audrey Strauss, Attorney for the United States acting under authority conferred by 28 U.S.C. § 515, announced today that TELEMAQUE LAVIDAS was convicted after a one-week trial of illegally tipping his best friend and co-defendant Georgios Nikas with inside information he obtained from his father, a member of the board of directors of a pharmaceutical company. Deputy U.S. Attorney Audrey Strauss said:  “As the jury concluded, Telemaque Lavidas was a key player in a long-running international insider trading scheme.  Three times he received insider information from his father about Ariad Pharmaceuticals and passed it on to his friend Georgios Nikas, a criminal pipeline that earned its participants more than $15 million in illicit profits.  Lavidas now awaits sentencing for his crimes.” Watch this site.

  Back on January 13 the Lavidas trial closing arguments came to a close, with the jury to return on January 14 to be charged on the law by Judge Denise L. Cote. After the jury left, the defense objected to the government providing the jury with only a redacted indictment, saying that CC-4 is Demane. Judge Cote quickly overruled the objection. After "all rise," Lavidas hugged his lawyer, and blew kisses at supporters in the gallery, where Inner City Press was.

 Now on January 14 Lavidas' lawyer Jonathan Streeter of Dechart has writtent to Judge Cote: "In the redacted Indictment that the Government sent to Your Honor last night, it included a version that contained materials marked with a red box that the Government stated had been redacted from the Indictment it proposes to send back to the jury. Your Honor had requested such a version so that you could see in one place what had been redacted from the Indictment, and what had not. In those portions marked with a red box, the government failed to include pages 4, 5 and 6 of the Superseding Indictment, as well as pages 13-14, and pages 22-34. The full Superseding Indictment, including those pages, is attached hereto. Those pages missing from the Government’s “red box” version should be inserted into Your Honor’s “red box” version so that you can see everything that has been redacted in one place. In particular, it is important to point out the following: pages 13-14 of the Superseding Indictment filed against Mr. Lavidas, which the government did not included in the “red box” version that it sent to Your Honor last night, states as follows: Specifically, CC-1 [Benjamin Taylor, to whom the evidence showed Darina Windsor repeatedly forwarded confidential information of Centerview at Taylor’s Moelis email address] and CC-2 [who is Darina Windsor] stole MNPI from Investment Bank A [Moelis] and Investment Bank B [Centerview], respectively, by accessing computer systems at those investment banks. CC-1 and CC-2 then shared the MNPI with CC-3 [John Dodelande], in exchange for over $1 million of benefits, including cash, trips and luxury watches…. After CC-3 [Dodelnade] obtained the MNPI from CC-1 [Taylor] and CC-2 [Windsor], CC-3 [Dodelande] passed MNPI to CC-4 [Demane] in exchange for millions of dollars of payments… CC-4 [Demane] provided NIKAS with the MNPI that CC-1 [Taylor] and CC-2 [Windsor] had stolen from Investment Bank A [Moelis] and Investment Bank B [Centerview], and NIKAS placed timely, profitable trades in securities based on that MNPI.

 In addition, on pages 4, 15, 25, 33 and 34, the Superseding Indictment alleges that Nikas traded illegally in the securities of Onyx based on information obtained from CC-2 [Windsor] and others. In both of its summations the Government argued that there was no evidence Darina Windsor was providing MNPI to Demane’s and Nikas’s network. In fact, the Department of Justice has alleged, in the very Indictment in which Mr. Lavidas is charged, that Windsor provided MNPI to Nikas and Demane. Moreover, it has so alleged in a separate Indictment of Windsor. The defendant requests that the full Superseding Indictment, with no redactions, be submitted to the jury." We'll have more on this.

  On January 8, Demane testified and was cross examined, including on his plea agreement to get out from under a possible 750 year sentence. He admitted to burner phones and to working with jouranlists to pump up stocks, specifically naming Bloomberg and a reporter in Canada (on information and belief, at the Toronto Star). The US Attorney's office wrote to the Serbian embassy for him, it emerged Here's more of how it went, from Inner City Press' live-tweet thread:

Lavidas' lawyer: You only met Mr. Lavidas once, in 2011, correct? Demane: Correct. Q: And you never spoke with him about insider trading? Demane: No. Q: No you did not speak, or no, you spoke? Demane: I did not speak.

 Q: You spoke about the sale of generic drugs to the Nigerian government, I mean the Algerian government, do you not? Demane: I did. Q: And this highlighted portion asks, Let me know if you have any interest? Demane: It does.

 Q: You wrote in March, "Do you have any interest, Telemaque?" and he wrote back "We don't have any interest, it's too late," correct? Demane: Correct. Q: You were extradited from Syria, I mean Serbia, on May 9, 2019, correct? Demane: Correct.

 Q: On the flight, you told the agents that the number of people involved in insider trading was huge, including reporters & traders, correct? Demane: Yes. Q: And you have met with prosecutors and FBI agents at least 19 times to get a more lenient sentence? A: Yes.

Q: You said you made $70 million, correct? Demane: Yes

 Q: So the US Attorney's Office wrote a letter to the Serbian embassy on December 30, 2019, is that correct? Demane: Yes sir. Q: The indictment against you has 38 counts and you pled guilty to all of them? Demane: Yes sir.

 Q: Let me ask you about the journalists to whom you leaked information, after you'd taken a position in it - and you would make money, correct? Demane: Yes.

Q: There were journalists in Bloomberg you leaked information to, correct? Demane: Correct.
 Q: So you would pay your sources in cash, correct? Demane: Yes sir. Q: You would have them generate a false invoice? Demane: Yes.

Demase: I was a Lebanese resident and they were Israeli, and there is no contact-- Q: So it had 2 purposes, to permit money transfer between Israel & Lebanon. Demase: Correct. Q: You hired Tarek to pick up money for you? Demase: It was Court Consulting that did it

Q: I'm going to ask you some questions about your use of burner phones. You always asked your sources to use them?  Demase: Yes. Q: And with George Nikas? Demase: We used Viber.

 Q: So when you met sources, you turned off your cell phone so you couldn't be tracked by cell site information? Demase: Not all the time, but yes. Q: You had a safe in your house with cash? Demase: Yes I was keeping some cash in the house.

 Redirect -- AUSA: Was the information you got about Ariad, was it unique? Demane: It was a different kind of source. AUSA: You were asked about your cooperation agreement... Does the outcome of this trial impact your agreement? Demane: No it doesn't. 

Q: You agreed to forfeit $48 million.. who decided? Demane: The judge. AUSA: Are you afraid for your children? Demane: Yes. Because I'm testifying. AUSA: How much jail time do you face? Demane: 750 years [!]

 And with that, Demane is led back into the cell block. The government offers into evidence exhibits mentioned during his testimony. 

But will US Attorney's office make exhibits publicly available, through Press? Or withhold as on #OneCoin? FOIA has been filed...  And Lavidas and Demane exhibits requested, including letter to Serbian Embassy...

  As to Bryan Cohen, the US Attorney's Office did not publicize the proceeding or its 30 to 37 month plea deal, but Inner City Press was in the U.S. District Court for the Southern District of New York Magistrates Court as the only media, and spoke afterward with Cohen's defense lawyer Benjamin Brafman. More on Patreon here.

  Brafman told Inner City Press the connection to the Lavidas trial is the same cooperating witness. More formally, he said that "To his credit, Mr. Cohen has accepted responsibility for his conduct and will thereby avoid a trial. We are hopeful that at sentencing we will be able to pursuade Judge Pauley that despite his criminal conduct Mr. Cohen is a fundamentally decent young man who should be sentenced in a relatively lenient fashion."

  In the proceeding, Magistrate Judge Debra Freeman accepted a consent order of forfeiture for $260,000. The sentencing will be before Judge William H. Pauley III on April 3 at noon. The case is US v. Cohen, 19-cr-741 (Pauley).

  On January 6, the trial of Telemaque Lavidas began before Judge Denise Cote. Assistant US Attorney Daniel Tracer in a short opening statement described it as an open and cut case, which will include cooperating witness Marc Demane.

  Lavidas' lawyer John Streeter told that jury Demane is simply trying to reduce his sentence and has no first hand information. Here's some of how it went, live-tweeted here.

 Hours after the opening statements, the US Attorney office asked Judge Cote to ban discussion of how it conducted its investigation: "Based on the contents of defense counsel’s opening statement, the Government respectfully requests a ruling in limine precluding the defense from introducing evidence about investigative techniques that the Government employed during the course of the investigation. As set forth below, such evidence improperly suggests that the jury shift its attention from the charges against the defendant to the conduct of the investigation, and is irrelevant and misleading. 1. Background In opening statements, defense counsel on two separate occasions engaged in a recitation of the Government’s investigation and the various investigative steps that have been taken with respect both to this defendant and other individuals. For example, defense counsel said: The third thing is that you are going to learn that the government gathered millions and millions of e-mails and text messages and electronic devices, phones and computers and all kinds of evidence from this huge network of people who were engaging in insider trading – from Demane, from Nikas, from their whole network. And you are also going to learn that they gathered e-mails, and phones, and computers and all kinds of other evidence from Mr. Lavidas. (Tr. 32). Later in his opening, defense counsel returned to the same topic: The third thing that I mentioned is that the government has been investigating this case for years. They have collected millions of e-mails and text messages. And they have collected Mr. Lavidas’s phones, his iPad, his computer, his documents. They have collected a long list of phones, computers, disc drives from Mr. Nikas. They collected a long list of those same things from Mr. Demane. And they collected those same things secretly, for years, from Google and other companies where their e-mail accounts were.... The Government respectfully requests that the Court preclude the defendant from introducing evidence about investigative techniques that the Government employed during the course of the investigation."

  The US Attorney doesn't want the jury to hear about this. And the public? Inner City Press will continue to cover this case.



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