The wife of John Kinnucan, the Broadband Research LLC founder accused of insider-trading, is asking a federal judge to suspend a case filed by the U.S. Securities and Exchange Commission, saying she has a negative net worth.
Catherine Kinnucan, the wife of the jailed analyst, said in a letter to U.S. District Judge Alison Nathan in New York, who is presiding over the SEC case, that she has “zero” income and that there is “nothing for the SEC to recoup.”
John Kinnucan, who pleaded not guilty to the criminal charges, was indicted Feb. 21, accused of passing inside tips to hedge fund clients about SanDisk Corp. (SNDK:US), OmniVision Technologies Inc. (OVTI:US) and other companies. He “befriended” employees of public technology companies, obtained nonpublic information from them and passed it to his fund manager clients, prosecutors in the office of Manhattan U.S. Attorney Preet Bharara allege.
“John assured me he was exercising due diligence with respect to operating his business in full compliance with all applicable laws and regulations,” Catherine Kinnucan said in an April 24, 2012, letter to Nathan made public today.
“The SEC has assumed it can recoup a substantial amount of ill gotten gains based upon the insider trading,” she wrote. “In truth, the net worth of the Kinnucan household is negative and I am struggling.”
John Kinnucan remains in custody in the federal jail in Brooklyn, New York, unable to raise $5 million bond.
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