What strikes any reasonable person about Matthew Kluger's story, at least as he tells it to BLOOMBERG BUSINESS WEEEK, is that he got sentenced 12 years for insider trading. His gain was about $1 million. The real incentive seems to be the high he derived from the excitement of distilling non-public information from M&A material he was working on at law firms such as Skadden and passing it on to traders. In addition, as an adopted child and homosexual before that was tolerated he had troubled teenage years, spending a year in the Yale psychiatric hospital. One more item. Before he decided to go to law school he sold Toyotas.
The 12 year part could have happened because his insider activities spanned 17 years. We recall Galleon head Raj Rajaratnam got 11 years. In October former McKinsey head Rajat Gupta will be sentenced. Clearly that will also send a signal from the feds about its determination to wipe out insider trading.
But, according to Kluger, insider trading is pervasive. Indeed, we have no idea how many current lawyers working on M&A projects are meeting traders in a parking lot, talking in code about deals, and making enough to support an exotic lifestyle. After all, lawyers don't make the kind of money investment bankers do, at least not from their day jobs.
By bringing his story public Kluger could be trying to influence the appeal of his sentence. That could go either way. It could irk the powers that be. Or it could frame his situation as an injustice which must be remedied.
In any event, quite a story it is. He should put together his autobiography in the joint. It could be made into a poignant film about Wall Street at a certain point in history.