| Two
Insider
Traders on
Trump Media
SPAC Pled US
Wants 2 Years
on Gerald
Shvartsman
by
Matthew Russell Lee, Patreon Book
Substack
SDNY COURTHOUSE,
Oct 9 – As the third of four
insider trading prosecutions
announced on June 29, 2023 by
the US Attorney for the
Southern District of New York,
Michael Shvartsman, Gerald
Shvartsman, and Bruce Garelick
were charged with making more
than $22 million dollars in
illegal profits by trading in
securities of Digital World
Acquisition Corporation based
on MNPI about DWAC’s planned
but not yet public business
combination with a media
company founded by former
President Donald J.
Trump.
On July 5, the
case was assigned - wheeled
out - to Judge Lewis J. Liman.
Inner City Press
was there on July 20 and live
tweeted, thread
On December 29 as
part of omnibus pre-trial
motions Shvartsman filed
copies of DHS reports of
investigation, including audio
recordings of Shvartsman
saying he would open an LLC in
Belize which would buy
assets... and ultimately
provided funding for the
'Truth Social' media platform.
It also names the agents who
brought the arrested
defendants to the Wilke D.
Ferguson Jr. Federal
Courthouse and the Marshals...
Late on March 15
Shvartsman through counsel
wrote to Judge Liman alleging
that the US used a Lawyer
Informant to record him.
Counsel identified the Zoom
account used: John [at]
lighthousetrust [dot]
ch. A Google search of
that shows a Lighthouse Trust
General Counsel named John
Ivsan at Linhart Seuss Ivsan
LLP
More on X for
Subscribers here
& Substack here
On April 29, jury
selection began but did not
end, by 6 pm. Of 34
prospective jurors in the
courtroom at 5 pm, each was
summoned into the robing room
for questioning, seemingly
with the defendant present.
Three were excused at 6 pm and
the rest told to return, but
not to read anything about the
case.
Then this request
to start anew: "during today’s
voir dire one prospective
juror openly reported in front
of the venire that she learned
from the news that “[t]here
are two people pleading
guilty” in connection with
this case. Upon the Court’s
request to speak up, the juror
again stated—adding
detail—that “[t]here are two
people pleading guilty and
[Mr. Garelick] is the third
person.” Voir dire continued
over Mr. Garelick’s
objection." Letter on Patreon
here.
On April 30,
after Judge Liman dismissed
some but not all of the
venire, the trial began. At
day's end one of Garelick's
lawyers, pushed for a proffer
of the defense says, named
three other possible tippees.
From May 1, Inner
City Press thread
On May 8, the
closing arguments. Inner City
Press covered them. From thread:
Assistant US
Attorney: They said that
Trump's Truth Social was
unique and was the target of
the DWAC SPAC - the defendant
was supposed to keep the
information confidential. You
don't need to read all the
complicated agreements to
understand it. It's an NDA
AUSA: The
defendant knew the information
was under a duty of trust and
confidentiality. GX 418, he
emailed the DWAC team, he says
Note: Some of these investors
may still need to sign an NDA
with you. He knew.
AUSA: He
was a hedge fund portfolio
manager - he knew what he had
to do, and he didn't do it. He
wanted to hide that he was
engaged in insider trading.
This is a huge deal. He
committed insider trading. We
have proven it.
Now defense
closing argument:
Defense: Bruce
stopped as soon as he thought
he might be exposed to
material non-public
information. No witness said
otherwise. None really knew
Bruce. The man Andy who was on
the Apprentice? Lovely guy -
but he didn't know Bruce
Defense:
Mark Wachter? He said he was
on a Skype call, but no other
interaction. The only US
witness who knew Bruce was
Hartley Wasco - and he praised
Bruce Garelick. They are
trying to prove to you that
someone who has never been in
trouble before did this
Defense closing
(still going) Defense: If
Bruce Garelick had a good
faith belief that he did not
have material non-public
information, even if it turned
out to be false, you must
acquit. Yes, he failed to file
forms - it wasn't top of mind.
Convict him on that
Defense:
Jurors, I don't get to speak
to you again. The government
does, with a rebuttal -
because they have the burden
of proof. In the jury room,
please ask, What would the
defense say? Is there another
way to see this? Jury duty is
an interesting thing
Defense:
When we vote, we got into the
booth alone - an individual
right. Jury duty, we form a
community, we share out
thoughts. It's a collective
effort. We do this in
beautiful courtroom like this,
because it's solemn [100
Centre Street next door, not
so much]
Judge: Jurors,
it's 12:50, we'll break.
On Garelick Judge
Liman (at 5:37 pm) - The jury
has left for the day. They
request the cross examination
of Bruce Garelick and GX 751
and 122. Please do this before
you leave. Good evening.
Adjourned
On May 9, the
jury found Garelick guilty...
On September 13,
Michael Shvartsman asked to
delay his sentencing to the
week of October 28: "defense
counsel respectfully requests
to adjourn the sentence just a
few weeks, to the week of
October 28th. The government
opposes an adjournment beyond
the week of October 14th, so
the issue is only 10 days. But
for the reasons below, that is
meaningful to defense counsel
to properly prepare for Mr.
Shvartsman’s sentence." Letter
on Patreon here.
On October 2,
Gerald Shvartsman asked for no
jail time, but home
confinement, when he is
sentenced on October 16.
Watch this site.
This case
is US v. Shvartsman, et al.,
23-cr-307 (Liman)
***
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