[caption id="attachment_7349" align="alignleft" width="196" caption="Arthur Cutillo "] Arthur J. Cutillo and Jason C. Goldfarb received final judgments Monday, October 17, 2011 stemming from insider trading charges filed November 5, 2009 based on incidents that occurred in 2007.

Arthur Cutillo and Jason Goldfarb are Charged

Arthur Cutillo and Jason Goldfarb were both practicing attorneys when they were charged with violation federal anti-fraud laws. The SEC "alleged that Cutillo misappropriated from his law firm, Ropes & Gray LLP, material, nonpublic information concerning upcoming corporate acquisitions, including the 2007 announced acquisitions of 3Com Corp. and Axcan Pharma Inc." The pair were further accused of tipping that information to Zvi Goffer, the former Schottenfeld Group, LLC. trader, in exchange for kickbacks. Goffer, in turn, traded on this inside information, as did his "numerous downstream tippees," including other Wall Street traders and hedge funds.

Arthur Cutillo and Jason Goldfarb End Their Two Year Ordeal

According to Litigation Release No. 22135 dated October 20, 2011, "Cutillo and Goldfarb each consented to the entry of a final judgment that: (i) permanently enjoins each from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder; and (ii) orders each to pay disgorgement of $32,500, plus $4,204 in prejudgment interest. In related administrative proceedings, the Commission suspended Cutillo and Goldfarb from appearing or practicing before the Commission pursuant to Rule 102(e)(2) of the Commission’s Rules of Practice." The Release also states, "Cutillo and Goldfarb each previously pled guilty to charges of securities fraud and conspiracy to commit securities fraud in related criminal cases,United States v. Arthur Cutillo, 10-CR-0056 and United States v. Jason Goldfarb, 10-CR-0056 (S.D.N.Y.). Cutillo was sentenced to a 30 month prison term and ordered to pay a criminal forfeiture of $378,608. Goldfarb was sentenced to a three year prison term and ordered to pay a $32,500 fine and criminal forfeiture of $1,103,131."