A federal judge in New York has found Mathew Mortoma guilty of involvement in what prosecutors have labelled the most lucrative insider trading scheme in American history.
Mortoma, an ex-portfolio manager at Steven A. Cohen's hedge fund, SAC Capital (SAC) was convicted on all three of the conspiracy fraud charges that he faced, which bagged the fund $275m (€202.3m, £168.2m).
"We are very disappointed and we plan to appeal," said Richard Strassberg, Martoma's lawyer via a spokesman.
Although he has not been setenced yet, Martoma, 39, could face a maximum of 45 years in prison, although the highest sentence to date in an insider trading case is 12 years.
Rather than cooperate with prosecutors in their investigation of Cohen, Mortoma decided to go to trial and fight the charges against him.
This verdict is the eighth insider trading conviction of a current or former employee at the fund which has long been the target of law enforcement authorities.
The FBI and the US Attorney in Manhattan, Preet Bharara, have been investigating SAC for a long a time.
Martoma, who worked in SAC's CR Intrinsic Investors division, was accused of hunting for confidential information from doctors involved in a clinical trial of an Alzheimer's drug being developed by Elan Corp and Wyeth, now owned by Pfizer.
Prosecutors said that Martoma used information based on a tipoff received from a doctor about negative trial results for the drug in question to his advantage.
SAC began selling its $700m position in Elan and Wyeth in July 2008 before the data was made public later that month.
In a statement about the case, Bharara said: "Martoma bought the answer sheet before the exam - more than once - netting a quarter billion dollars in profits and losses avoided for SAC, as well as a $9m bonus for him."
String of Guilty Verdicts
The ruling in Martoma's case came after a different jury in the same courthouse convicted Michael Steinberg who was a portfolio manager at SAC in December 2013.
Steinberg was on trial for five conspiracy and securities fraud counts due his role in a different insider trading scheme.
Martoma's conviction continued an unbroken record at trial for Bharara.
The attorney has secured guilty pleas or verdicts against 79 individuals since October 2009 as part of a wider crackdown by his office on insider trading at Wall Street firms.
Thomas Gorman, a defence lawyer at law firm Dorsey & Whitney said of these convictions:
"This unbroken string of wins for the government in insider trading cases will have huge impact. It's getting widely circulated, so it does have a chilling effect of those in the trading business considering insider trading."
Meanwhile, the Securities and Exchange Commission is seeking to blacklist Cohen from the financial services industry for failing to keep watch on Martoma and Steinberg.
The SAC founder, who has not been personally charged with any crime, is ranked among the 50 richest Americans and is worth just under $9bn, according to Forbes magazine.
In November 2013, his fund agreed to plead guilty to insider trading allegations and pay $1.8bn to settle the charges.
In July 2013, SAC was charged with four counts of securities fraud and one count of wire fraud.
Allegations from prosecutors had accused the fund of being involved in "systematic insider trading" dating back to 1999 and running through to at least 2010.
Apparently SAC "relentlessly pursued" information on publicly traded companies which was used to boost its returns and fees.
At its zenith SAC managed $15bn in assets.