Ex-Goldman Banker Gets Home Confinement in Insider Case
Ex-Goldman Banker Gets Home Confinement in Insider-Trading Case
(Bloomberg) -- A Goldman Sachs Group Inc. investment banker was sentenced to a year of home confinement, avoiding prosecutors’ request that he get three years in prison for providing stolen client information to a global insider-trading ring that generated tens of millions of dollars in illegal profit.
Bryan Cohen, who pleaded guilty to conspiracy in January, admitted passing tips about deals involving Buffalo Wild Wings Inc. and Syngenta AG to Marc Demane Debih, a Swiss trader who is cooperating with prosecutors after his arrest last year. Cohen, 34, was sentenced Tuesday via video conference by U.S. District Judge William Pauley in Manhattan.
Federal prosecutors had urged Pauley to sentence Cohen to 37 months in prison, saying he leaked secrets to Demane Debih for three years in a “cunning and calculated” crime. The judge gave him less time after reviewing medical records suggesting his chronic asthma would subject him to an increased threat from Covid-19 if sentenced to prison.
Cohen’s guilty plea means he can’t work in the finance industry again and, as a French citizen, he’ll also be barred from the U.S. after serving his sentence, his lawyer said. Dozens of friends and family members, many of whom listened in on the hearing, sent letters to the judge seeking leniency for Cohen.
“I engaged in conduct that undermines everything I stand for,” Cohen said during the hearing. “Today I’m begging you for compassion,” he said, telling the judge he just wants to lead a “simple and honest life.”
Arguing for a stiff sentence, Assistant U.S. Attorney Richard Cooper called Cohen “a full and complete participant” during the hearing. “He was a sophisticated and educated investment banker,” the prosecutor said. “It was a crime of greed and opportunity. The defendant was already wealthy. The only reason to commit this crime was to get more money.”
Cohen and Demane Debih acted more like drug dealers than white-collar criminals, using code words, burner phones and intermediaries to pass large sums of cash, Cooper said.
Cohen’s lawyer, Benjamin Brafman, urged the judge on Tuesday to give the defendant credit for the seven months his client spent on home confinement in New York while awaiting his sentence and that he allow him to serve community service with underprivileged kids in France.
Pauley called the idea of Cohen serving home confinement in France for a crime committed in the U.S. “unenforceable and absurd,” and ordered home confinement in the U.S., 1,500 hours of community service in New York plus a $25,000 fine. Cohen has already forfeited $260,000 in proceeds under an agreement with prosecutors.
Brafman said after the hearing that he is “relieved and delighted with the outcome.”
As of November, Cohen was living in a one-bedroom Manhattan apartment with his wife and mother. He unsuccessfully argued that month to be allowed out of home confinement there, claiming the situation was detrimental to his “physical and mental health.”
Abandoned Scheme
Brafman said his client is a “kind and compassionate” man who abandoned the scheme with Demane Debih “long before he thought he was going to be arrested.” He said Cohen developed asthma as an adult, which exposes him to a greater risk from Covid-19 than other inmates.
The virtual hearing, made necessary by Covid-19 related restrictions faced by the court, was interrupted numerous times when participants were inadvertently dropped and when the feed to the press and public was disconnected.
Cohen worked for Goldman from 2010 to 2019, first as an associate in London, where he met Demane Debih, and then as a vice president in New York. Prosecutors said he provided insider tips between April 2015 and November 2017.
After Cohen moved to New York, he used burner phones to pass along tips, according to prosecutors. The phones were supplied by Georgios Nikas, a friend of Demane-Debih and the owner of a Greek restaurant chain who also participated in the insider-trading ring, according to court records.
Nikas, who faces U.S. charges, is believed to be in Greece.
Demane Debih, who was arrested in Serbia and extradited to the U.S., said he passed at least $1 million to Cohen or his brother in the south of France, who stashed the money in their parents’ house, according to the government. Demane Debih pleaded guilty to 38 criminal counts, admitting he made $70 million from trading on secret information he got from a network of bankers in the U.S., Europe and Israel.
Shortly after Cohen moved to New York in 2017, Buffalo Wild Wings asked Goldman for advise on a takeover approach by Arby’s Restaurant Group Inc., prosecutors said. Cohen was made aware of the potential acquisition the same day, Oct. 17, 2017. Nikas purchased 22,000 Buffalo Wild Wings shares between Oct. 20 and Oct. 27 for $2.5 million, selling 9,000 of them by Nov. 1 for an initial profit of $79,074, the U.S. said.
The case is U.S. v. Cohen, 19-cr-00741, U.S. District Court, Southern District of New York (Manhattan).
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