NEW YORK, May 9: A Manhattan court federal magistrate on Tuesday set a $1 million bail for Hafiz Naseem after he was charged with masterminding a $7.5 million insider trading ring.
Naseem, a Pakistani banker with Credit Suisse, was denied bail as he was determined to be a flight risk and charged with insider trading.
At a hearing on Tuesday, Judge James C. Francis IV said that he did not think that Hafiz Mohammad Naseem would flee to his native Pakistan, given the conditions his lawyer had proposed for bail, a New York Times report said.
Naseem, 37, was arrested last week and charged with leaking information to Ejaz Rahim, an official at Faisal Bank about nine deals, including the $45 billion leveraged buyout of Texas power firm TXU Corp. Credit Suisse was an adviser on all nine deals.
Mr Naseem is also facing a civil lawsuit brought by the US Securities and Exchange Commission.
According to the report, at the 90-minute hearing, Joshua Klein, assistant United States attorney prosecuting the case, and Marc L. Mukasey, Naseem’s lawyer, sparred over the merits of charges. Mr Klein said the government’s case remained “extraordinarily strong”.
The newspaper said that Mr Mukasey informed the court that he would call a former head of investment banking at Faisal Bank in Pakistan to testify on Naseem’s behalf. He said that Ejaz Rahim, who had identified himself as the focus of the SEC’s investigation, would testify that he made a trade in TXU’s options after speaking with an analyst in London, and not because of information from Naseem.
According to the newspaper, a lawyer for Ejaz Rahim, Spencer Barasch, said on Tuesday that his client was an investment banker and was on a leave of absence from Faisal Bank. Without identifying Rahim as the anonymous corroborator in his case, Mr Klein dismissed him as a potential defendant in the SEC’s lawsuit whose testimony might be untrustworthy.
After Mr Klein described as evidence phone calls Mr Naseem made from his office to the unnamed official, Judge Francis cast doubt on the government’s case, calling the argument “plainly inferential”, the NYT report said.“Clearly a jury could look at the facts as they’ve been laid out in the complaint and decline to convict,” the judge said.
