Still time to flip Martoma?

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The industry has been operating under the assumption that Mathew Martoma, who was arrested and charged with running what has been called the most profitable insider trading ring ever, was the target of big effort to get him to flip.

Indeed, the WSJ says the effort reach back as far as a year ago, when the FBI showed up on his doorstep in Boca Raton. Prosecutors were no doubt salivating at the thought of having an insider acting as a star witness against the biggest fish in the hedge fund sea. The arrest, the press coverage, and the charges all seemed to be signs that Martoma had refused, and thus would face the full wrath of prosecution.

But is there still a chance, he might turn states evidence?

DealBook reports that, "It appears, for now, that Mr. Martoma will fight the charges. But the crucial question, as it relates to Mr. Cohen, is whether at some point Mr. Martoma will reverse course, admit to insider trading and agree to help the government build a case against his former boss. Without Mr. Martoma's cooperation, it is unlikely that the prosecutors have enough evidence to charge Mr. Cohen."

It's unclear what would make Martoma flip now when he hasn't done so previously. The calculus for him may boil down to what kind of witness his doctor-tipper, an 80-year old neurologist, will make. The whole case will likely boil down to his testimony. It does not appear as though any wiretap evidence will be used. Cohen is no doubt hoping that Martoma will be vindicated at trial, if it comes to that.

For more:
- here's the article

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