Inside Trader to FBI Informant: The Man Who Exposed Wall Street

24:33I didn't make any trades that day, but later that day, I was talking to a friend at another trading firm. He's down that month. He's losing money. He works at a firm where you only eat what you kill. So he's down that month. He's like, look, man, my wife's pregnant. I'm losing money. Is there anything out there you could help me out with? I said, hey, I'm not trading this right now. I don't, at the point, I still had a moral compass. I'm not doing this. But if you want to do it, here's all the information. I could have been arrested right there just by sharing it with him the way the laws work because I'm tipping this inside information to him.

25:05He tells his whole firm, he tells the head trader at his firm who buys a couple hundred thousand shares. When this head trader is later arrested by the FBI, his nickname in the indictment was Octopussy because he had his tentacles and banks, law firms, anywhere you could get information. This was his business model. He buys a couple hundred thousand shares. The woman that called me, she said her entire brokerage account was in this stock. I remember thinking, that's probably not great, you know, in terms of a flag, but hey, she's in it. Every day, the stock's trading up a little bit. I'm still holding on to my moral compass, but a week goes by, my buddy calls me, bro, are you in?

25:45And at my hedge fund, me as the junior, I could buy a stock in our portfolio and not have to talk to the boss as long as it was less than 1 % of the money we managed for clients, like a small position, like a new idea I'm working on. Hey, boss, I have a new idea. I remember pulling up Excel. How much is a 0.9 % position? 14 ,000 shares. Putting the order in, I committed securities fraud of felony just by keystrokes, putting the order in. And then that was it. That was the start of it. That was the start of it. How much can you actually put on a day? So you only get 1%, but what is that of a billion, 10 billion?

26:26It's of 100 million. So it was a$999 ,000 stock position. So it turned out, based on the stock price, it was like 14 ,000 shares. So it was a small position in terms of the money we were managing. two more weeks goes by. I was talking to two friends outside my firm. I was kind of thinking about this, but not really, because this woman's always full of shit. Who knows? She could be making it up. So I called two buddies. I'm like, what do you guys think of this? Sort of as my sounding board. And one of the guys is like, I can't believe you even know something like this. It sounds like that movie Wall Street with Michael Douglas, where it's like a blue horseshoe loves like a stock tip from a movie, and he's like, what the hell?

27:08I'll buy a little bit too. And so now I'm bringing these guys into the crime, but I think highly of these two guys. I knew them from university. These are great guys, I told myself. They're just starting their families, great men, and they're fucking doing it too. And now I'm like, I don't even feel, not that I ever felt bad, but I'm like, I actually feel okay about this. A week goes by, the stock is halted for trading before the stock market opens, so that means news is coming, word for word, exactly what she said. And at first, my heart started racing, like, oh, shit, this is a blatant tip. And then I go and meet with my boss, is he gonna fucking fire me?

27:47I go in and talk to boss. We had 25 stocks we'd always go through, is anything changed that we wanna sell, do we wanna buy? He gets this stock chronos, he's like, oh, it's one of those. Don't tell me how you're doing this. Keep me out of it. So that further fuels kind of the rationalizations in my head. Guy knows what I'm doing. He wants to be willfully blind. He wants to be kept out of it. And at that point, I started actually having an adrenaline rush. Like now I'm part of this in-group. Now the Chinese mafia, the Indian mafia, now Tom Harden, whatever my mafia was. Like I'm part of this group.

28:22And now I have status. And at 28 years old, I felt like I didn't have status. I was always insecure about these other guys. And now I'm part of the group. I went to this conference the next week. I told these guys, one of the guys in the Indian mafia, hey, I knew about the Kronos deal. He looked at me, he's like, you're not part of our world. Like you, Tom, you actually do real analysis. I'm like, I do that, but they also know about these trades now. And by then she had called me with the next deal of the four stock tips I got. And the guy put his arm around me. He was like, hey, you're one of us now.

28:52So why was she telling you? Why give you a junior this information? So it was four tips from her. And I was wondering that too, like, why is she giving me perfect information? It's usually back and forth by the third. But could she have seen you as a weakness by giving you information, deflecting from what she's done and because you're doing it blatantly, a junior, but then you're hitting all these jackpots that would raise concerns, surely. It would. And by the third tip in trade, she basically said, these aren't for free. and if we're going to keep doing this, Tom, I have to pay her source$15 ,000 in cash.

29:28So I was like, that sounds fucking illegal. I had rationalized the trades. I was fine with the trades. I'm like, are you kidding me? How would I even get the cash to him? And she's like, bring it out to me in California. I'm living here in New York. So I call my buddy who I had tipped. I'm like, here's the situation. If this is going to continue, my source, I kept it. I didn't tell him what my source was, but if you want to keep the gravy train going, this guy wants a$15 ,000 kickback. My buddy says, no problem. He calls Octopussy. Octopussy owns a bar in the city. He's got petty cash in the safe.

29:58No problem. Here's$150,$100 bills. We meet at the train station in New York, a very clandestine operation. He slides the FedEx envelope to me across the table at Grand Central Station, and I'm now taking the taxi to LaGuardia Airport in New York. so i've got fifteen thousand dollars 150 hundred dollar bills in this envelope in my laptop bag i'm going to this conference out in silicon valley i go to lauguardia airport it's like august it's hot it's hot as hell i'm sweating and i get to security there at the belt i'm like fuck i can't i can't put this through here let me go to the bathroom i went to the bathroom put all the cash like down my shirt i had uh shorts on like a waistband no i'm sorry i had sweatpants on i had waistband, and I put it in my socks.

30:46So I'm walking up to, at the time, it was still a metal detector, so not like the screening machines today. I'm walking up to the metal detector. I put my laptop back down. I've got all this cash on me. The security lady says, sir, nothing in your pockets? And there was actually nothing in my pockets. I said, nothing. I'm good. Went through. I was sweating. Didn't set anything off. Went to the restroom. Took it all off of me. Put it back in the FedEx envelope, put the envelope back in my laptop bag. Now my flight's called the board to San Francisco. There was actually two security agents at the gate of my flight, randomly doing checks.

31:24It was a few years after 9-11 in New York, so there was still high security. My group has called the board. I'm not making eye contact with them. I'm going right to the plane. They said, sir, could you step over here? We need to check your bag. I thought, fuck, they're onto me. They grabbed my laptop bag. The woman puts her hand. She opens the FedEx envelope. She sees the cash. She looks at the other agent and looks at me and said, sir, have a nice flight. So I went and sat down on the plane. I thought, fucking never doing this again. I went to California, gave the woman the envelope. I said, I'm not ever doing this again.

32:01You won't believe what happened at the airport. and she's like sure you're sure you're not sure you're not yeah you'll do the next one and i did the next one so how but surely see when people are like people get a tip like surely some people might get sierra has all the best active and outdoor brands for the super athletic stuff like running gear for cruising up the trail and the super athletic ish stuff like fishing gear for chilling by the creek nice cast fitness apparel to push for higher reps. You got this. And golf balls priced so you can afford to lose one. Or a few. Head to Sierra or Sierra.com for the brands you want at the prices that let you do it all.

32:43From athletic to athletic-ish, Sierra's got it. Propel Fitness Water with Gatorade electrolytes, zero sugar, and vitamins. Propel hydrates better than water to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade electrolytes. This episode is brought to you by ChatGPT. Hey, it's Bill Simmons from the Bill Simmons Podcast. Have you guys heard about ChatGPT work? It's the new way to use ChatGPT for bigger multi-step projects. And when you need more than just answers, give ChatGPT work access to your apps and files, and it can create real work documents like spreadsheets, slides, and structured reports.

33:25Get started at ChatGPT.com by selecting work mode available on Plus and Pro Plans. information. It might not be 100 % accurate, but what happens then if someone says that I'm looking at, if you're an analyst and you're checking everything and see you had it and you eventually find that. So do people ever actually get stocks and the boom, but then be investigated because they think, how did you know that? Can that happen also? It happens a lot where the person is not insider trading illegally. they get information. And what will happen still to this day is maybe a hedge fund, somebody's trading on the illegal information, another hedge fund's buying the stock at the same time just happens to be investing in the stock.

34:09What the FBI will do is go scare the crap out of all these people to see who has the information and who doesn't. And if you start talking, even if you're not guilty, you can still put yourself in a terrible situation. But that happens a lot where what you have to do now as a stock analyst is you have to document all the reasons why you're buying this stock. Like I did this legitimate research. You know, I talked to this company or that company. You have to document all that. So if there is an investigation because you were buying at the same time a corrupt fund was buying it, you have your documentation there.

34:41You can't, you know, not document anything because these investigations, I mean, they can look back at the stock trade from four years ago and say, where's your documentation on this trade? And you're an analyst and you're like, fuck, I didn't write anything down. I just had a good idea. You can be put through like a reputation destroying investigation and be found not guilty. So how much were you making with this inside information? So on the four trades, my firm made just over a million for our investors. On those trades, me personally, basically the price of my fucking career,$46 ,000. That's it.

35:14That's it. That was the price of my professional suicide,$46 ,000. I never thought about the money. So why were you doing it then? It was just status. It was like - To feel part of something? To feel like I was part of something, to feel like I was part of one of those end groups. Foolish. Is that all you've ever wanted in life? That's at the time. That's what I thought I wanted. I was so insecure because those guys were cheating to get ahead. When I finally had the information, the four tips, and they were putting their arms around me saying, you're one of us. Now I just felt part of that, that group.

35:47I didn't know it was$46 ,000 until years later, when I had to write a check. to the government. They said, this is what you owe us for those four trades. And I threw my whole career away. How much were you getting per year anyway? How much were you making wages? About half a million a year, more or less. So even$46 ,000, uh, the average disgorgement on this inside, the average case in the U S is$58 ,000 where somebody throws their career away for, you know, certainly not a lot less than they're going to make in their career. So you're making nearly 50 grand a month. Yeah. Um, and how was life when you were making money, surely you must have felt a bit of power when you were making money anyway.

36:24Yeah, I was in my twenties doing really well. Um, but again, like my wife and I, we lived in a small apartment in New York. It wasn't about, uh, cars or anything like fancy like that or watches. Um, it was just, you know, I'm part of the, I'm part of the group. Now I'm part of the group that has status. I can go to the conferences and people would look at 28 year old, 29 year old Tom and say, Hey, that guy is one of the people in the in groups who has the information. And that was, that was important to me at the time. like what people, I was so insecure about what people thought of me. And I think it maybe went back to my applying to college and getting, you know, told like you can't get in now, you're not good enough.

37:01And now I felt now I'm in this elite industry and now I'm in the illicit in-group and now I'm good enough. Is it easy for people to have this inside information to then pass it on to others for them to do the dirty work and then to get a percentage? Yes. That's a common thing too, where you'll see a case, the person has the information, maybe they're the company insider, and they'll call their friend at the hedge fund or at whoever is in the stock market, and that guy will make millions of dollars and then give a kickback to the person for the information. Or you'll see sometimes the kickback is a vacation or a watch.

37:38But when the person's caught and you're like, you just threw your career away and you probably look into prison, it's never worth it. It's just at the time, they rationalized what they did. So why did that woman come to you? So she wanted to, basically she wanted me to set up this cash payoff for her. And the FBI also felt that she was sort of grooming me to be somebody that could give her information in the future. She was about 20 years older than me. And she felt at some point in my career, I would be able to give information back to her. But it was really to be kind of a cash mule for this, for this, her source of information.

38:12who was giving her the information so she didn't have to touch cash to give to that her source of information. How long was she doing this? She was doing it. So she actually, so this was around 2007. Back in 2000, she was doing this. She was caught by the FBI then, and that case was sealed, so it wasn't public. They were going to use her as the key informant on this billionaire Raj, Roger Rotnam. And so she actually is probably one of the few people who a few years later went and did it again. And eventually they would knock on her door and say, you're doing this again. You know, who did you tell this time?

38:50And she didn't talk to a lot of people. So she said, you know, she talks to this billionaire and she's like, I talked to this young guy in New York, Thomas Harden. And they're like, who was that? So they had no idea who I was until they talked to her. So you've made a million for your clients. I would imagine you've made them more as well. Oh yeah. We were up that year. So the 1.2 million was basically like 1%. We were up 31 % that year. We were up 30 % without the insider trading. We were up 31%. So what's the point? I mean, it's like - Over 300 million? Yeah. So over 30 million on that$100 million fund.

39:28So 30 million, 29, you know, doing it the right way, and 1 million insider trading. So it wasn't other funds. It was their business model. for me it was just i told myself at the time it's just a small trade i remember the first one i said i'll do it just this once and never do it again it's never it's never just this once what makes a good trader what actually makes a good trader my young nephew carter he wants to do trading he's only 14 and 15 he's got his laptop and he's like fake money right yeah but what makes a good trader yeah it's important it's important to start that way to get to get comfortable with it it's psychology, when you're making money, you can't be too high.

40:09And when you're losing money, you can't get too low. You have to be very just even because over time, you're going to have your ups and downs. Great traders only make money 51 or 52 % of the time, but they cut their losses on the losing 49 % very quickly, and they let their winners ride. So that's what makes the difference. Like a great trader isn't batting 80%. It's usually 51, 52%. Who's the biggest trader in the world? The biggest trader in the world right now is probably, there's hedge funds here that are called multi-manager hedge funds. These are bigger hedge funds like Millennium or Citadel.

40:48These are the biggest names in the world right now. The biggest individual market is actually not a stock market, it's the gold market, which I think is about 30 trillion. The second biggest market is silver, which has had a run in the last year or so. Those are the two, actually, the biggest kamali markets are those. What about day trading? Day trading is big now, much more so than when I was in the business 15, 20 years ago. There's so many retail traders now that are, like they're basically, a lot of them are on Reddit and they're kind of YOLOing. You only live once their money and you're seeing these stories of these kids, these young kids, putting everything in some meme stock, you know, and blowing up.

41:30And it's one thing to learn your lesson that 23, 24, 25, when you don't have money, you can learn your lesson. But there's people like there's Reddit forums where if they're truthful, it's like a 45 year old man, you know, betting on some stock, all of this, you know, net worth into one speculative stock and losing it all. Did you ever come across Bitcoin? I came across Bitcoin, um, back in 2017. Yeah. And I think it started when, 2010? So I was tracking it. When it crossed the thousand, it was January 2017. Actually, I could only buy, I wasn't allowed, I'm still not allowed to buy individual stocks myself, but I can trade crypto.

42:11I'd never understood crypto. I only understood Bitcoin being kind of like digital gold. And that's the only thing I'm allowed to really own as an individual asset. Yeah, the gold and silver sort of running now is mind-goggling. It's crazy. I think if you had bought the same amount of silver like 20, 30 years ago, you would actually only be up a few thousand dollars. You wouldn't be up that much, which is crazy. So it shows you how much it's crashed. Yes. I read that and I thought, surely that can't be right. Surely if you're thinking you're buying that back in the day, you're going to be a millionaire, but you're only up a few thousand.

42:45No, you would have been better off just buying the stock market. It would have been much more, or Bitcoin, obviously, back um back 2000 is it the is it the s p 500 the s p 500 is the stock market how good is that oh it's gone up um probably 10 12 a year say the last 10 or 20 years i'm not sure the exact numbers but it's always it always goes up over time because it's inflation it kills people it's not actually their money it's inflation yeah you know so to keep up with inflation you have got to invest but I don't know I was a bad gambler back in the day so I can't really do it because I'm not the guy who's maybe sitting with money I would be all in like you say it's the ghost trait bits here bits there I would think fuck it I'm all in and if it doubles or trebles I'm thinking I'm going to go on something again until I end up with nothing like I would love to because I looked at silver and gold Sierra has all the best active and outdoor brands for the super athletic stuff like running gear for cruising up the trail Woo!

43:43And the super athlete is stuff like fishing gear for chilling by the creek. Nice cast. Fitness apparel to push for higher reps. You got this. And golf balls priced so you can afford to lose one. Or a few. Head to Sierra or Sierra.com for the brands you want at the prices that let you do it all. From athletic to athletic, Sierra's got it. Propel Fitness Water. With Gatorade electrolytes, zero sugar, and vitamins. Propel hydrates better than water. to help you get the most out of your workout and get back to your best self. What propels you? Propel with Gatorade Electrolytes. This episode is brought to you by ChatGPT.

44:24Hey, it's Bill Simmons from the Bill Simmons Podcast. Have you guys heard about ChatGPT work? It's the new way to use ChatGPT for bigger multi-step projects. And when you need more than just answers, give ChatGPT work access to your apps and files and it can create real work documents like spreadsheets, slides, and structured reports. Get started at chatgpt.com by selecting work mode, available on Plus and Pro plans. I've looked at the S &P 500, and I think 10 % every year with your money, it's a good investment. But then again, could that crash? Yeah, it crashed. I mean, there's a drawdown every year, or every couple of years, 2008, 2020.

45:09But if you're young, it's good, because then you can invest more. And over time, you know, it goes on. Because I follow the man, like the scientist guy, like the guy with the gray hair. He looks like, forget his name, but he's always massive on the S &P 500. And he just says it's up fucking$3 trillion today. I don't know if he's talking shit, but there's some great investments you look at and think I would be on that. But I think you can lose yourself. I don't know anybody who does it that actually wins unless you're really one of the top 1%. Yeah, it's hard to beat the stock market. So my advice to anybody is always just invest in the stock market.

45:44It's very hard to pick stocks and beat the stock market. But what's happened today with retail investors, there's so many more retail investors in the stock market, and they are making these crazy bets on one stock or one crypto coin. And they're often losing money. And so it's kind of like, and now with prediction markets, where you can bet on the outcome of elections or you can bet on the outcome, not just sports, but elections or anything. That's a whole other level of potential insider trading where we had in the States an NBA player. He made$200 ,000 in kickbacks on an illicit gambling ring a few months ago.

46:25This guy makes$300 ,000 every half of an NBA game and he blew up his career for$200 ,000 off of getting a kickback at one betting ring where he was, he purposely was missing his shots to throw the game and he was arrested a couple of months ago. Yeah. Because they're investigating, I think the NBA and the NFL. But again, it's greed. Yeah. Human beings are greedy. They always want more. They always want more. Now with the apps on our phone, it's addictive. There's going to be more gambling addicts with these sports apps. I keep it off my phone. I would, I would be drawn to it. And is it really that big, if it's a nothing game to miss, maybe a few shots, you know, to let that team maybe one way.

47:06four or six points the first half. It's not that deep. Even in snooker. You know what snooker is? Yeah. You don't really have snooker in America, but it's like, who's going to pot the first ball? Who's going to win the first frame? The first frame isn't, it's not game ending, so you can come back and win, but what's the first colour going to be potted? That's easily to fix. Yeah. But I don't know, obviously you'd need certain websites to place these bets, because in the UK, if you're betting something like that, more than like a hundred pounds or a hundred dollars, there's flags up. But these betting companies don't want you winning.

47:37And if you are winning, they're going to investigate. When did you start getting investigated? So, uh, seven months after the fourth tip and trade from this woman, I wasn't really thinking about it. It was 2008. So this is the financial crisis, uh, 630 in the morning in July. I'm leaving my apartment to drop off some dry cleaning in New York. I step on the sidewalk and behind me, I hear this voice. Are you Thomas Covey Hardin? My full name. The last time I heard my full name was my mother back in about to whip my butt, so it wasn't Mom. So I turned around, two FBI agents, dark suits, wallets out, any American crime show, you know, FBI, come sit down with us.

48:14So we sat down at a Wendy's, right down the street from here, actually, at 55th and 8th, and he's like, look, man, we know about your four trades last year. We know that you were just down in Georgia visiting your baby nephew, and he knew my nephew's name for his baptism two days ago. And my first thought was, oh, my God, my parents are going to kill me. What are they going to say? And I thought, oh, my God, my wife's going to leave. We just got married. She had no idea about these trades. And I thought, holy crap, this might impact my career. Oh, my God, I might be going to prison. But it went from dad to prison.

48:49I start making implicating statements. Yes, I made four trades. They're all writing it down. I said there was this thing at the airport where there was$15 ,000, and he's like, oh, go on. Go on. I didn't... It wasn't like, I wasn't another great criminal. It wasn't like, guys, what do you have? Prove what you have on me. I just start vomiting all this stuff up, and they're like, all right, settle down. They're trying to get you actually shut up. You're telling them too much. Yeah, they had no idea. They just said, this guy's interesting. They had approached the woman I found out later, and she's like, check out this guy, Tom.

49:23Two months before they approached me on the street, she was in New York. She's like, Tom, we got to get lunch. She's never in New York. We go and get lunch at Rockefeller Center, a restaurant. She's like, hey, Tom, if you were ever asked about those trades last year, what would you say? You know it was illegal, right? And I'm like, yeah, it was illegal. So she was wired up. And my friend who I had tipped two days before the FBI approached me, Tom, we need to get coffee at Starbucks. Hey, Tom, you know those trades last year? I didn't put it together. You know those trades last year? What would you say if you were asked?

49:54They were illegal, right? Yeah, they were illegal. He was wired up. So they sent it on me at this Wendy's, you know, my head's spinning. They're like, you can help us out. You can help us build these cases. I asked them, I came to, I said, should I talk to a lawyer? FBI says, don't talk to a lawyer. They're not supposed to say that, but they're playing the game. They know they have me. I take the card. I walk outside. I'm kind of delirious. The agent's like, I'm going to call you a taxi. This is the worst day of your life." I'm like, yeah, it is. He calls me a taxi to work. I'm late for work. My boss is like, where were you?

50:32It's a financial crisis. We're getting destroyed in the stock market. I'm like, my wife, Sue, she was sick. I made something up. I go to the desk. I try to sit down in my chair, go to the restroom. I'm like, fuck, I got to talk to somebody. I had converted to Catholicism for marriage. We got married a few years before. I thought, man, this is a great time for a second confession. I went to St. Patrick's Cathedral in New York. Tuesday afternoon, there's a really long line. I was thinking like how many guys were just picked by the FBI? You know, gallows humor. I go and talk to the priest there and close the door, forgive me, father.

51:05FBI approached me this morning and I said, I started with my life story. You know, I was a kid. I helped my mom out with the daycare. He was like, get to the point. FBI was there this story and I slipped that in. He's like, wait, he said, it sounds like most of your life you did the right thing. Like 1 % of your life you really messed up. but I don't know if I was suicidal, but it was dark. And he was like, if they're giving you the chance to clean up the industry, you should do it. That was my penance. I should have talked to a lawyer too, but I talked to a priest. And the FBI had told me at that meeting, they're like, you can't tell anybody other than your wife.

51:36So the FBI called me, I said, I've already violated what you told me. I talked to a priest. They're like, okay, that's fine. You could talk to a priest, but I still, I still had to figure out how to tell my wife about this. Can you not use that against them that they told you not to use a lawyer, surely, because it's innocent to proven guilty. There's no case or nothing. They can't give you advice like that. Could you not have used that against them? I mentioned it. I didn't hire a lawyer for almost two years. And then my lawyer said, of course they're going to say that. He's like, hey, you're the bad guy going down for this.

52:09They're the good people at the FBI. It's not going to work. But they're definitely not supposed to say that. You have the right to defend yourself and talk to a liar. but I was just scared. I felt like I was drowning. That was a Tuesday morning. How am I going to tell my wife? We just got married. I was getting up before she woke up. She would text me, what the hell? Like, the sun of your bed is soaked. What's going on? You pee the bed? I was just sweating through it. Just like, I might as well. If you passed the bed, Tom, it's okay. Yeah, I know. I don't recall. I blocked that out if I did. But just sweating through it.

52:47And then I would get home late. um we had some uh stock positions in asia so i said hey i have stuff going on asia tonight i was walking to central park just sitting down like how do i tell her i remember one morning that the lowest i felt um uh it was like you know i could just push the button there was a balcony on top of our building i'm like i could just i don't have to tell her if i do this you know yeah just that one day and I thought, I can't tell her. I'd rather just do this. And another thought came into my head, how selfish that would be. What would my parents, how would that impact them?

53:33So I went to work. Then it's Friday, and I have to tell her, it's Friday after work. We have the weekend. I'm not going to be able to escape to the office. And so we were a young couple in New city always how was your week she was working at lehman brothers which was a bank that went bankrupt during this time so she was having a hell of a time at work she had all these stories all year her stress was crazy i said let me go first i have to go first this week you have to sit down i told her everything tuesday morning uh fbi is asking me about these four trades i remember saying i wasn't making up excuses like i made these trades this is this is what i did and the way she took it, she's like, can you say that again?

54:14I said it again. And she's like, you didn't do anything to hurt me. And she was like, if the FBI has given you a chance to clean things up, you should do it. 85 % of wives would walk out there or, or kick the husband out. That's a stat I found. Um, because of the money's dragged up. Yeah. Because they were married to the future hedge fund guy, not, not the future tipper X. Yeah. A lot of these guys with money have got their young trophy wife though they've got 10 out of 10 they're getting their handbags they're getting what they want they get a walk with the trophy wife i'd imagine that would be a high percentage so you were worried that she would leave you i was were you worried that she was only with you for the money no the glp1 pill you've been waiting for is now on row yep it's finally here with the same clinically proven ingredient now in a pill and now on row it's the first fda approved glp1 pill for At the lowest price available, that's one daily GLP-1 pill for big results.

55:13Now on Rho. Go to Rho.co slash listen to see if you qualify. Rx only. Go to Rho.co slash safety for serious side effects and boxed warning associated with GLP-1s. Advertising on Spotify puts your brand in the moments where Gen Z fandom takes shape. They're 35 % of our audience and spend two hours building rituals and shaping culture with every stream. Download the Culture Next report to discover trends and insights that will inspire your next campaign. I wasn't worried about that. I was just worried she would leave me. We had no kids. We just got married. She could very easily say, I don't even know who I married.

55:49You're insider trading? Like, I thought you were a good guy. But it wasn't easy. But it seemed like at the time she was going to stay. And again, I would hate to think if she kicked me out or if she went back home to be with her parents, what I would have done to myself. And what would the sentence be if you get found guilty of these portraits? Based on the million dollars my firm made, it was like a three-year sentence, potential sentence to prison. At that time, there was this Occupy Wall Street movement that was really heavy at the time where people were protesting in downtown Manhattan after the financial crisis where they wanted Wall Street defendants to do a lot of prison time because of the financial crisis.

56:33So at the insider trading trials, the prosecutor would tell the jury, you know, you can't pay your mortgage because this guy bought this stock. And they never went after the bankers. They went after the people trading stocks. So that was a risk at the time. But before then, I told her on Friday, and I said, I'm going to call the FBI Monday and see what they mean by all this. I met the FBI for lunch, and they had a small piece of metal a few centimeters big on the table. and we had Blackberry still then. I was naive. Tom's kind of a theme. I said, is that a Blackberry battery? They're like, what do you think it is?

57:11It's a wire. Like a wire? I thought a wire is like strapped to your chest. Like, no, the technology is a fault. Yeah, it's not a sex. This records conversations. And I said, well, and they said, the problem is, Tom, the woman has already wired up on you. Your friend wired up on you. I was like, what? And I played the conversation in my head again, Starbucks, I'm like, oh yeah. And he's like, we think you can help us out. And the way they positioned it was like... You can do something to help your country. That's the way they framed it. And that would be very easy for me to say today, oh, I did this because I was helping cleaning up the industry.

57:55I did it to be honest. I did it to save myself. Yeah. That's pretty honest. I would have said that as well. Yeah. I would have said you've done that for the save your own ass and your wife. Yeah. Yeah. That's a, that's a cop out. I didn't say you're doing it. It wasn't a clean up industry. Yeah. It was, uh, It's always going to go on no matter how many wires you wear. Yeah. I was drowning and I thought I got to climb on top of a to breathe. And it's about my wife. And I said, you know what? If I can help them build the cases against people whose business model, that's the way I thought about it.

58:22But I'm always going to be conflicted there. Because then they had me running around. It was crazy. Because there was no training for this. They said, who are the worst actors? I'm like, I don't know. Maybe I could build a relationship with this guy in Silicon Valley. Mr. Silicon Valley, I call him in the book. I changed all the names, obviously. And so they're like, do you know him? I could probably to get a meeting. So the way the playbook was, it's 2008, everybody's not doing well in the market, we're all probably out of the jobs. I would text my friend who worked for the Target and say, do you think your boss would be looking to hire?

58:55I'm probably going to lose my job. Could he meet for coffee at the conference? So I'd go and meet these, you know, not billionaires, but centillionaires that were 20 years older and say, hey, you know, I'm Tom, not doing well this looking for a job. I knew about these four trades last year. I have contacts inside companies. And then I had to get to the point like, and how do you insider trade? But if you're a target and you're meeting me kind of for the first time face to face, and within three minutes of this conversation, I'm asking you about a crime you committed a couple years ago with the stock Trigg, you might look at me and say, what the hell?

59:36And so this guy, Mr. Silicon Valley, changed the subject. And I thought, oh my God, I'm terrible at this. And the FBI was always sitting at a table next to me because they wanted to make sure that I wasn't sliding you a piece of paper saying, don't say anything, I'm wearing a wire. So they were there. I'd have this, I'd bungled the conversation. Then I would change the subject. It was so uncomfortable. I thought the thing was this big on me. And then I gave the recording device to the FBI. They would call me the next day and say, you did a terrible job. I said, hey, it's my first time doing this.

1:00:11I didn't have any training. And they said, what you're going to have to do is ask a question and then say nothing. If it takes the target minutes to respond, just sit there. So then I'd ask the target a question. And it was usually three meetings. the first meeting was usually in person. The second meeting would be on the phone. Hey, I want to follow up on these ideas I had or just make something up. The problem with if you're trying to get information from somebody on the phone is something like in communication, 55 % of it is body language. 38 % is tone and only 7 % is word choice. So if you're on the phone trying to get information, you're losing half of that.

1:00:54Like here we have the body language, but on the phone I can't see your body language. So you can't really get information. So then you have to get to a third meeting, which is back in person, and then come back, ask the questions again. And eventually, these guys would say just enough, like, oh, I have a contact inside this company, or I have this source giving me information. I was playing up to their egos. They looked at me as like the young version of themselves. And then the FBI would listen to it the third or fourth time and say, all right, Tom, you're done here. On to the next one. but they didn't give me feedback if I was good or bad or whatever what was their deal though what deal did they offer you at the start how many people did you need to get or there was nothing it was just like you're gonna follow our orders it might help you out I didn't talk to a lawyer I was I didn't talk to a lawyer for two years so they were using you for two years surely you can surely that's a complaint in itself against the police to be using someone as an informant for two years for that.

1:01:52It's not a big crime where you're going to get 10 years of life either. Right. But they've found the perfect guy whose asses went and was willing to do anything to stay out of prison. Yeah. You would have done anything. You're the perfect informant. Yeah. You would have went anywhere and spoke to anyone. So who, so it came from the women, the women get caught and it's her, it's what a wife. See if you denied all that, what evidence would they have had? I don't know. I don't even think they know about the cash payoffs. It's like at that Wendy's when I'm vomiting all this information, Yeah, because there was only you involved in it.

1:02:21They're writing it down as fast as they can. Oh, thanks so much, Tom. You're doing a great job. Yeah, you've spoken. Because what would they have had, really? Other than hard word against Jews? Yeah, basically. I mean, they had my stock trade, but still, I could have made up excuses. Oh, it's rumors or whatever. Yeah, it doesn't prove anything. Yeah. But eventually, when I started talking, and you're right, they had profiled me for weeks, probably. This is a regular guy. They even told me, you know, you're a regular guy. Like you leave the office and go home to your wife. Not many guys on Wall Street do that.

1:02:52So you're not partying, snuffing, coke, shagging, hookers. Have a hooker. Yeah, have a side piece. Like went home to my, I missed some fun in my 20s. But you know, I was, I married a devout Catholic and just like, this was the, this was young Tom. How bad is the cocaine within? Oh, it was big time. Is that? Big time then, yeah. Cocaine. And then it became speed where speed was a big thing just to keep, to stay awake. how many coffees are people drinking a day? Oh my God. Like probably a dozen espressos and just like trying to, trying to keep it, trying to keep your brain going. Um, but speed coffee, uh, cocaine was big, uh, the two thousands.

1:03:30So you have to wear a wire for over, over 40 times. Over 40 times. So they just turn you, cause if you come and see me and you're talking shit like that, red flag straight away, I'm walking away. Yeah. Like anybody with a bit of savvy, anybody 20 years old, they're thinking, nah, you are wearing a wire. Why are you even saying that? Doesn't make sense. There was like, there was one guy, one of their top targets, to your point, it was probably 15 face-to-face conversations for coffee. Every time he would change the subject, but he kept meeting with me. One Sunday, he gives me a call, and on a Sunday, he said, Tom, we need to have dinner tonight.

1:04:10We need to talk. And I called the FBI, I said, this guy, wants to have dinner. They got super excited. They met me at the train station in Manhattan, gave me the wire. I took the train on to Connecticut to meet this guy where he lived for dinner. I go to his car, he's kind of smiling. I get in his car, and he said, I've got swim trunks for you. We're gonna go swimming at my mother's house. And so he's on to me. That show The Sopranos is popular that summer, so all these ideas were going through my head. I said, let's go swimming. I was used to playing it cool now. Let's go swimming. So we go to this house in Connecticut.

1:04:48He starts disrobing in this room, so he wants to see if something was taped in my chest. It was in my front pocket. I excused myself, went to the restroom, took the wire out, put in my jeans, put these swim trunks on. So it's the two of us walking out to this pool. It was so quiet. I saw like a shovel against the house, a hole in the ground. I thought, holy shit, is this guy gonna have me killed or something? And then I saw he was having some landscaping done. I got out of the swimming pool. He grabs a tennis ball, and we're playing this awkward game of catch. He's pouring it on psychologically, freaking me out.

1:05:20I just wanted to go home." He's like, Tom, I've been acting kind of weird, which I had. He said he spoke to an attorney, and the attorney said, that guy must be wearing a wire. Ask him this question. And I said, what's your question? He's like, all right, Tom, have you been approached by the SEC, which is the stock market regulator, not law enforcement, the FBI? And so I tried to polter. I tried to give him a hint. I said, no, not the SEC. He's like, okay, I just wanted to make sure you weren't wearing a wire. He starts making implicating statements about all of his stock trades. It's obviously not recorded.

1:05:53That guy, one of the worst actors, was never charged because they didn't record that conversation. And up until a few years ago, he was actually still managing money for pensions and endowments, and they never got him. So when he was in the swimming pool, did he then know that you were being an informant. That's why he was doing this whole... What's the difference then between entrapment then, in America? Because if you're going to people and trying to catch them out, and they're not coming to you, what's the entrapment law? It's very close. It's very close to what I was being set up to do. Like, trying to get somebody to confess a crime, uh, this way.

1:06:31There's, I'm not even sure what the nuance of the entrapment law is, but it felt like I was always doing that. But at the same time, the FBI was giving me no feedback. no good job or this type of thing. So your morals have kind of already went, but when did you actually feel that some of these guys, some of them don't actually deserve to be there, but you're trying to get a confession to put these guys away who also have families and kids and bills to pay. Like when did you start completely losing it? You've lost yourself anyway by doing what you're doing, but I'd imagine it gets darker and darker.

1:07:05It gets darker and darker. It got to the point where they were asking me about, uh, the two friends I had mentioned who I thought were great guys. They're like, they're up next. I said, that's where I'm drawing the line. Like these are good men. Not that the other people, I didn't know the other people. They could have also been, I mean, they were all probably decent family men or, or whatever, but I didn't know them. And I felt that they were the worst actors. But when they were asking me about my two friends, I said, this is it. This is, I'm done. It had been 48 times. Uh, now I had a lawyer two years into it.

1:07:33And my lawyer couldn't believe I had gone without counsel doing this crazy stuff. And I said, they told me not to talk to a lawyer. And of course, he said, yeah, they're going to tell you that. I talked to him. I said, I have to draw the line here. He said, that's a risk. You should be doing what they ask you to do. I said, I've done so much for them. I don't even know if it's going anywhere. And then maybe a month later, it's October now of 2009. My wife had just given birth to our first daughter. She's at home from leave. The FBI calls me. It's 6 AM. And they said, turn on the financial news network, CNBC.

1:08:076 a.m. Friday, I turn it on, like 20 guys wearing handcuffs. And it was the perp walks, the FBI windbreakers. The news cameras just happened to be at their houses or their apartments. And I remember starting to see faces, people I recognized. And I was of two thoughts at that moment. This was my work, but also this is disgusting, what they're doing, like parading people out in front of the news cameras. Like it was sort of out of sight, out of mind. Like, I don't know what's going to happen. The FBI is telling me, not giving me any feedback. And then seeing the news cameras there, people being walked out of their homes.

1:08:46But it was also my own doing. How many other informants were there? 32. 81 people were charged. 32 of the 81 were informants. That's a lot of snitches, Tom. Yeah. That is a lot of snitches. So for anybody want to go and get into trading, be careful. So the 32, were they already inside trading? Yeah, they all were. When did you find out there was 32? Uh, when all the names were released. Uh, that day on the TV, there was 20 names released. And in the middle of those 20 names, there was one name who was not released. And, uh, the name they were calling the person was Tipper X. And I could figure out, you know, I was an analyst.

1:09:28I could figure out, okay, I think I'm Tipper X. I called the FBI. Am I Tipper X? He said, yeah, that's you. So when did you lose your job? So I left my firm. You didn't get sacked? So I actually was going to resign on a Friday. And you were still allowed to trade while being an informant? I was allowed to trade while I was an informant. Not on the list of information. Sometimes they actually have you continue to commit the crime as you're building cases because then it gets people actually recorded doing the crime. So you could have still done it. So I still could have done it, but I wasn't getting any tips.

1:10:03So there was nothing. Because you'd have been suspected, it would have went round that he's acting funny. And they approached that woman before me. And the thing is, the police here is crazy like the laws. I interviewed a man called Larry Mazza. Larry Mazza was a hitman, I think, for the Gambino family. He worked with the Grim Reaper. The Grim Reaper killed over 200 people because he was working for the FBI. He was an informant, bringing down the mafia while he could still kill people. Wow. Well, what the fuck is that? The ultimate crime. Who is that? Like, insider trading, that's PG's. You know what I'm saying?

1:10:43So why did you not think, right, I'm just going to smash it here and make as much as I can? Because you've got a free pass. Yeah, I wasn't getting any more tips. I had the four tips and then they approached her. So she was shut down. She was my source of information. So I'm here not getting tips. So I'm not helpful anymore to anybody. running around. Were you still making money though? No, it was the worst stock market in 75 years. So I was losing money at the office. My second job, so to speak, was being this FBI informant. I would leave the office at lunch, go meet with the agents in the black town car outside the office, sit in the back, talk to the agent about the next target, and then get briefed and then go have that meeting.

1:11:27So this was going on for two years, then Tipper X was revealed. And then eventually, I drew the light at my two friends, and they said, they got pissed about that. And they said, your name's coming out tomorrow. And so on the front page of the Wall Street Journal, Tipper X was Thomas Harden in 2010. And this was in January on a Wednesday. My wife just went back to work from the maternity leave on Monday. So she's at the office. She's still working, but it's not great. So Monday, she's showing pictures of the baby to her colleagues. Wednesday, she has to answer questions, like why her husband's name is on the front of the Wall Street Journal.

1:12:05She was holding it together, because she had to keep this secret too for a year and a half. She comes home from work that day. Now I'm a stay-at-home dad. I'm depressed. I got overweight. She comes home, like news cameras. It's a 24-hour story. She walks through the door, she grabs the baby and she's like, I can't believe you did this to us. That's the lowest I felt worse than the Wendy's worse than ever. And the New York times actually put, uh, my, my baby daughter's name in the article, cause my wife kept the family blog just with updates. So I wasn't calling back the New York times and they said, okay.

1:12:41So why did they not? So if you're an informant, why did not protect you? Why was it? So you've decided enough's enough. and then it's all come out in the papers. Yeah. Do you think they would just keep using you for three years, five years and kept going? Or was it already coming out in the paper? Because that seems a bit of a, how you've just says that and then it's all come out. Were they just using you until how far you were going? Yeah. Until I drew the line. Because surely if you get one is enough to eventually get it done. But you were just, you were just a little guinea pig. Yeah. Just until I drew the line, until I said enough's enough, it could have kept going for years.

1:13:14It could have been, I got credit with 20. It could have been a lot more. But they were also still letting you keep your job. Yeah, I was sacked. I was going to resign on a Friday, and on Sunday, I got an email from my boss saying that I was fired, because my performance was terrible at work. So you were losing money? Yeah, losing money. And so basically, stay-at-home dad, names on the front page of the Wall Street Journal. In this situation, like a national story, you figure out who your true friends are. So I got four texts that day from friends from university saying, if you need a beer or coffee, I'm happy to talk, but pretty much everybody cut ties.

1:13:56Yeah, of course you're a snitch on it. I said, they're like, nah, obviously. But then again, if you grew up with you, you would know you were a good guy. You know, you were going to bend, you know, you're not built for that. It's not your life. You're a hardworking man. A family man wants to make money to have everything legit calculated and opportunities came and you've not even ask for it but this is the thing, they've done that to you that woman, it looks as if she was already caught, so when she came to you saying do you want to do this and that she's got you involved, for me that's entrapment she's got you, she's already wearing her wire, she's already bringing everybody else in so she can keep her job and bring out you've been caught up in the crossfire she's picked you as an easy target was that came out that she was wearing the wire at the very start Yes.

1:14:46Eventually, after the fourth trade, I saw they approached her in the fall before the summer when they approached me on the street. So going back and looking at all the charging documents to see the timeline, I saw that they were at her house like months before. So she was charged years before and then went and did it again. So a recidivist. And they asked her, who did you tip? And she said, this guy in New York. Yeah, I think she's already been wearing a wire before she's came to you. I think she's already been working with them. So I do. I think when she's came to you with the first inside trade, she's been wearing a wire then.

1:15:25She could have been, yeah. Million percent. I don't think you should be able to do deals with the police if you've been caught and then try to bring other people down. Yeah. That doesn't make sense unless she knows the police were investigating And then she's thought, okay, I'll bring everybody else in. Yeah. And I can bring them down with me. How many convictions? Uh, 81. But 32 were informants. 32 were informants. Right. So how many, how many people get sent to prison? Um, so 27 informants didn't go, so 81 minus 27. So 54, about 54 people did some kind of prison time. Uh, the longest was an 11 year sentence for the billionaire, the Sri Lankan billionaire, uh, Raj Rajaradnam, and the guy, the guy, Octopus, he got a 10 year sentence.

1:16:13For long sentences as well. For a white collar crime. Yeah. You know, 11 years, a billionaire, surely he would have had money to get away with that. Yeah. But they've accepted their crimes. They never became informants or anything. What about the other five informants? So you said 27, did they go to prison? Yeah, the other five. So the woman was an informant. She went to prison for a year, uh, because she, uh, she was supposed to be the main informant on the billionaire and she went and did these trades. and so they gave her a year and the other informants got six months to a year or something like that.

1:16:43And the judges were just throwing the book at Wall Street defendants. And so we didn't even know, my lawyer wasn't sure what would happen with me until they figured out. The FBI wrote me a letter saying I helped them build 20 of these 81 cases. And I was supposed to be sentenced every few months for years and years. And so 2010, it was supposed to happen in 2011. It kept getting pushed out to 2015. So between the FBI approaching me on the street and being sentenced, it took about seven years. So most of my thirties were gone, stressful. My wife, I mean, she was amazing. She held down the fort and she said, just be the best dad you can be and you'll figure it out.

1:17:25She always had faith that like I would figure it out. And I'm not sure where, as I said, she's devout Catholic, but where that faith in me came from, she just said, you'll figure it out. And so as a dad, my only job was just to take care of the kids. But I think also my lawyers are going to have to start your own company in this situation. And so I was trying to do real estate deals, trying to get investors. And my investors would say, what did you do before this? They'd say, hey, don't Google me. If you have to say, don't Google me, it's usually nothing's going to happen. you. Yeah. Where do you think you would be without your wife?

1:18:06I don't think I'd be here. It's pretty dark. Yeah. Um, yeah, it's, if she kicked me out, I don't, I don't, she's amazing. Like I never talked to a psychiatrist or I talked to, I just talked to a priest and talked to her. But it's not that deep. The investigation and the, the informant is a lot worse. The stress that they put you under, you'd have actually been easier just taking a deal, doing a sentence of six months and being done with it. I would have started my life over a lot quicker. Instead of nearly 10 years of just pure peer pressure from the police, from the state, from courts, when I'm going to prison.

1:18:47So you didn't even know if you were going to prison or not after all these years. Nothing, even as a dad. So I remember carrying my daughter up the stairs one day. I was well over 200 pounds, had trouble breathing. I called my mother-in-law, can you come watch the baby? I should go to the doctor. The first time I had my blood work done during this, and the doctor was like, what the hell is going on with you? So the first time I told this story was my doctor. He probably canceled his appointments the rest of the day. And he's like, look, man, when you're 40, you're going to be really obese. I'm going to have to pop your chest open.

1:19:17And so I told my wife, She was like, I'm going to sign you up for a 5K race. I'll beat you pushing the baby in the stroller. And she did. But running kind of lit a fire because I couldn't work, but I could just focus on what I could control. So I went from 5Ks to marathons to ultra marathons. I was running. One year I ran 100 miles a week, 5 ,000 miles in one year because sports was good to get out of my head, but also not good because it allowed me not to have to deal with my personal life. Or when my wife would come home and say, how's the job search going? I would just go for a run. I wasn't a good husband at the time.

1:20:00I don't want to deal with this. I'm going to go for a run. Yeah, I got really fit, but overall it wasn't great because it allowed me to just not have to deal with manning up and saying, how the hell am I going to figure out how to start a second profession, career again. What did your mom and dad say? Um, it was tough. Um, because starting at the start of the story, you're saying that you do everything for them, you want to make them proud. And then bang, you're a police informant sacked from inside truth. Yeah. And they, and they saw, and the law, I guess, like the maximum sentence could be 20 years or something.

1:20:37And so they saw that and it took a while to, You still love your child, but still, it's not what you expect. They just know I'm so successful in finance. They don't really know what a hedge fund is, just like Tom's doing great. Tom has a great career. He went to this fancy school, and now he's king in the world in New York City, and then they see this. When did you tell them? Um, they were actually, so Tipper X became public and that weekend they were actually flying up to New Jersey to visit, uh, for my daughter's baptism. So I'm going to have to tell them on this, this happy visit. Not good.

1:21:17It's like face to face. I don't want to do it on the phone. It's had to be. Listen, you've not killed any cunt. You've not fucking done anything that bad, but you know, you can see you're a good guy. You're a bit shaken up by it and you still probably are. But he ain't a bad guy I would have done it If somebody comes to me Now listen There's a good chance I'm doing it My life is going great I interviewed a man Called Sam Miller Sam Miller was part of the IRA And they ended up Getting sent to prison At Long Cash I think it was called And they called them The blanket boys They never had any clothes They didn't wear the prison outfits Because they thought They were political prisoners But the police used to Beat them every day They never had one visit Within that 12 years So they didn't know what was happening outside And he thought He got out Changed his life Met a woman Married Came to New York Working in the casinos Making money Everything's going great in his life Someone came to him He's got kids His wife And he's making serious money Somebody came to him with a bank job And he says Listen there's a bank job here in New York One of the biggest bank heists in New York history And he took it He fucking done it and ended up getting life in prison to get caught.

1:22:31Life in prison. He thought, why, why did I do that? And ended up getting out in the Good Friday Agreement and one of the presidents pardoned him. But his life was going so good. He didn't have to do it. There's something in his mind just wanted that little mora, some little buzz or something, and he done it. So the mind plays tricks on us. Your life is going good. You're making 50 grand a month. You've met the woman in your dreams. You've got a little bit of power. You've got status. That wage now is massive. That's in the top 1%, I think over 50 grand. Oh, sure. A year there's a 1 % earner. Was it never enough?

1:23:08It was again, it wasn't, it obviously wasn't money. It was, you know,$46 ,000. Um, you know, I speak at a college every year where the professor does the math on what I would have made, just just so the students like, what's the point here? Question. He was like, oh, 15 year career, you probably have $23 million. So he'll turn to me. He's like, why'd you do it for$46 ,000 for the students to see. It's a good question. In hindsight, but then you've got to pay tax on that. You've got your own bills, you know? So for trading as well, a lot of people seem to be involved in that now. Do you still take a look?

1:23:38Do you still look at it and think, hmm? Yeah. I mean, today, this is what I do. It seems more bigger than ever. It was, uh, so the FBI, I was sentenced to the no president and the FBI invited me to speak at the FBI. Uh, they gave me a call. It's a restricted number on the phone. I thought, oh, fuck, what do these guys want now? My wife said, what did you do? I don't know. was I downloading movies? Like, answer, hello? Hey, Tom, how's it going? I just found out my five-year-old, she was shy, and I'm like, I wanted her to play soccer, like me, only if you'll be my coach dad, but you have to pass the background check.

1:24:13I'm like, look, this is nonviolence, it's going to come up. The league said, you know, Dahlany, nonviolence, it doesn't matter, you can't coach kids. So I told the FBI, well, I can't coach my daughter. Other than that, you know, things are great. I think they thought my life was great because I'm Tipper X. They, no, I still have a felony. And the FBI invited me to speak to their rookie agents. So I went there. I said, hey, first of all, an informant is an asset for you. Don't tell them not to talk to a lawyer. They're like, oh, sorry, our guy said that. I'm like, okay, yeah. And then spoke at the FBI.

1:24:46And they said, have you ever thought about just talking about this with these young professionals? Because it's always regular people that get caught up in this stuff. I mean, There might be a Bernie Madoff or some crazy guy once in a while with his regular people. Then it was just really this pilgrimage, just going to college, not charging anything, is there even an appetite for this story? Then the hedge funds today started bringing me in for the prevention training. What happens today is there's so much information coming into these funds where you don't have to be nefarious like me. You could be negligent where something comes into you and, oh, this sounds interesting.

1:25:22Let me place a trade. Like you're not doing a cash payoff or anything. It just comes in, you place a trade. And if you didn't talk to anybody, like if you make decisions in isolation, oh, I know what, I know what this is about. You can actually be charged and you're not even, you know, it's, there's no, in the U S there's no statute for insider trading. It's very wide. It's prosecuted as securities fraud, which is the same thing as a Ponzi scheme, which is much different. You're taking somebody's money and then doing something else and keeping it going. Um, and it's probably going to be that way because it allows the prosecutors then to have a wide lens of bringing these cases that they don't want everything.

1:25:56But once you're charged, even if you're not guilty, you're basically your cruise over. It's reputational. What about the penny stocks, the world for wall street, Jordan Belfort. What other penny stock did you ever come across them? I didn't come across that world, but at the time, uh, when I was making these trades, all we saw was the FBI focused on that, on that world, sort of the boiler room type of places. Like they were never really, as far as I could see, were focused on legitimate businesses like hedge funds. And so one of the prosecutors who had worked in narcotics where they were using wires and informants on organized crime, she went to a judge and said, we could actually use these wires and these wiretaps on the phones against like legitimate, like white collar businesses.

1:26:40But the judge would have to approve it every time because it's a major invasion of privacy if you're tapping somebody's phone. So they would have to go every time to get approval to tap phones and then build the cases that way. So it was a new tactic for these cases. And the best evidence in court was, you know, on the cross. Oh, you didn't say that? And then play the tape. But if you look at Elon Musk, when he does a post about Bitcoin or anything, the stock market will throw the roof. Mm-hmm. Surely that's, so what would they call that then? If someone starts speaking about it, surely he can say, listen, I'm going to do a post tomorrow.

1:27:14Is that classed as insider trading? As long as he announces it publicly, it's not because it's public information. Even if he says to someone before it that he's going to do it? Oh, if he says to somebody before it, no, that's, yeah. So that's insider trading? Yeah. Where is the borderline from hearing hearsay of a company who's going to go bust a, where is it? It must be a very thin line. It is. It's thin. So there's three elements. The information has to be material. So if it were public, it would move the stock price. So big news like that, non-public. So if you were to search the internet or scrape the internet, it's nowhere to be found publicly.

1:27:51And the third element, somebody has to breach their fiduciary duty in sharing the information. So a company officer or in these cases I was involved with, sometimes a lawyer would tip information to traders and get kickbacks. So they're breaching their duty to their clients. So that's the third element. So you can hear information that's rumors. and, but there's a, to your point, it's kind of a gray situation where if you're trying to be careful and don't want to be charged, you have to talk to like every company has a compliance department where you run that by them. Hey, this is what I'm thinking about trading.

1:28:25What do you think? And then once you've offloaded that to that, that group, it's no longer your problem. Where you can get in trouble is I'm going to make decisions in isolation. I know the laws. I know exactly what I'm doing. It just takes one young prosecutor who hates these hedge fund guys who making 10 times what they make and say, I'm going to make my career on you. Uh, and it's, it's very great. We're going to try to build a case and see, see what happens. So if it's in the media, you can then, you can then buy the stocks as long as it's public information. Yeah. So what if I've got someone the way my mind would work?

1:28:57What if I had someone who works in the media to print a very small story and then start buying the stocks once that story breaks straight away? Is that classed as fine? Yeah, no, as long as it's, if you buy it before it, that's insider trading. Once it's out, then it's public. And then you start trading it, then it's public. But the newspapers and the media must be out at different times. So we used to get the late newspapers saying, like, on Friday, they would come out maybe on the Thursday, the Thursday night at midnight. So what happens if I got someone, I worked in the media, listen, just print a little story here, and then I buy the stocks once up.

1:29:32So that's classed as okay. It's okay as long as it's public. What will happen too sometimes is a company will be betting against a stock, so they want a negative article, and they'll tell the newspaper, here's all my research, why this stock should be down a lot, and they're short it. Then they'll put it in the newspaper. Then the newspaper will print that article. The stock goes down, and they take their position off. They profit from it. That's even more nuanced because they have the position on, they're letting them know, and they're trading it. But it's very fact-specific. It depends on the exact facts of the case.

1:30:14The problem is there's no clear-cut definition for what it actually is. Who's been the best ever trader since the stock market started? Is Warren Buffett must be up there, eh? Warren Buffett's up there. In the hedge fund world, there's a guy, Stan Druckenmiller, George Soros, Steve Cohen, owner of the New York Mets here, those are considered some of the best stock traders of all time. Why are they so good? And you try to tell me they have never done inside trading at all? I mean, who knows? Yeah, we're only speculating, but to get to that level, there's got to be some elements of corruption. Yeah, I mean, there's corruption all the time, but I would say it was a choice on my part to partake, so cheating is a choice.

1:30:56Plenty of people didn't cross that line, so I did make a choice, and I own that, to cheat. What's the most anyone has ever lost trading? Oh, lost. I mean, people have lost their, I want to say probably the biggest loss was a couple billion dollars, long-term capital management. This is going back in 1998. There was an Asian stock crisis. I want to say they lost, I don't even know what the numbers are, but billions and billions of dollars. And these were PhDs, like Nobel Prize winners, like the smartest guys in the room, lost it all. See, when you're trading and then you cash out, how fast does it get the money?

1:31:37How can you get the money? Can you go to the bank? How does it all work? So, I mean, when you cash out, the money is in your account right there. So if you were trading like your brokerage account, it's all right there for you. You can take it out. I mean, anytime. It's very liquid, like the stock market. So you can go to the bank and lift out cash? Yeah. I mean, you can just transfer it out of your account. So if you have a here like Fidelity or E-Trade are the big accounts and you have your money in there, you're making stock trades, it works out in your favor. You can wire the cash out to your checking account.

1:32:06You know, so you can press the button and it comes out instantly to sell your stocks instantly. Yeah. What about on the floor when they're doing all that shouting? And how does all that work? That's going away. That was more - Is that not here anymore? It's very much all computers now. I love it. All that we know had to suit jackets, different colors. Yeah. And they're all shouting. Were you involved in that either? Right as I started, that was going away 25 years ago. When I started, there was the old guys with the gray hair were still doing it. They built their careers that way, but maybe it was 10%, even 25 years ago.

1:32:39And now that's going away. There's just a few guys now that, but that was more like setting the price, doing the hand signals and all that. Now it's all electronic. And now there's also zero commissions. So they used to charge a commission on their trades. now they're zero commission. What was the movie with Kurt Douglas, Michael Douglas, Wall Street? Wall Street was Michael Douglas. Well, that was an insider trading situation with Charlie Sheen, there was a new one as well. Again, great movie, but it is interesting. I don't know too much about it. So forgive me for my ignorance, but I just don't know anything about, I can't get involved in it.

1:33:15I would fucking love to, but I would lose everything. There's a, in the US, it's prosecuted most in the US than any other country. there's about probably 50 cases a year. But the average person, when you read it, like, what did this person throw their career away for? It's usually about$58 ,000. You think, well, why did they do it? It's so stupid. But if you've got insider information, why can't you just hammer it? Why can't you just put everything on it then? I mean, you could, but you risk, you know, getting caught. But could you not do it once and then deny it? Who can say anything? Everything's witnesses.

1:33:48Yeah. You know, but obviously hindsight's a wonderful thing get this information and do it yourself. Sometimes it's good to have people involved as well, because you're not lonely and you can speak to people. Well, that was my thing. When I called my two friends and they were in, I felt now we're like strength in numbers. These guys who I thought highly of are in it. It made me feel okay with it because now these are good guys and they just broke the law or whatever, but I felt fine. Were you nearly caught everywhere in a wire? only at the swimming pool. And actually, one other time where there was a Silicon Valley hedge fund manager, I was out there.

1:34:23He wanted to go to his wine cellar before going out to dinner. And so I was asking him, I was clumsy, Tom, asking all these very pointed questions or like to your point where he was like looking at me. And he said, what are you wearing, a wire or something? And I just thought, what do you think I am, the FBI? And laughed. And he just sort of smiled and then kept getting the wine. Like he was, I don't know anything about wine, but he was caressing the wine like it was a baby or something. Like this is the whatever, I'm like, I don't know what the fuck this is. But like, I was scared, so I just, I changed the subject then.

1:34:50How's life like now? Life is, it's good. Um, no, I have two daughters, 16 and 14. My wife stayed with me 20 years married through this. She's the real hero through all this, keeping me around. Um, the hardest part for me was just kind of like forgiving myself.

1:35:20I guess I was caught going through this for years. Like, oh, why'd they get me for 46 ,000? Why didn't they get that swimming pool guy? Like I kind of almost had some years like a victim, and like they got me for nothing. 10 years ago, there was a situation here in New York where HSBC was laundering money for El Chapo, and all they did was have to pay a$2 billion fine. All their employees went to work the next day. Nobody was charged. Or first Boston was laundering or was, uh, doing tax evasion for their clients, like blatant stuff. And all the bank had to do was write a check to the government.

1:35:56Employees were fine. And I went through billions of dollars and these guys are fine and they got me. My wife always brought me back. She's like, is that helping you find a job? Like, no, she's like, well, stop feeling sorry for yourself. So I had to, I had to get through that. Because you're not a big player, Tom. The bigger they are, the harder they are to crack. So what they'll do is the bigger ones will get caught, but they'll take away the smaller ones to get them away. Like that's how the game operates. I think that's the lesson in the book. Like they're going to read Tom's story. Hey, he seems like me.

1:36:27Yeah. They get the, they get the guys. It's the ones who are paying the billions. Who've got the money to then pay their way out. Yeah. You've been too honest with it. I think it's the other telling them to fuck off, prove it. What are you going to do? Yeah. I mean, it's not that deep 48 grand, and it's also destroyed your life at the same time. And the most disgusting thing today is US Congress. It's rampant. They sit on committees. Defense committee trades defense stocks. They'll sit on other committees, trade those stocks. And the penalty is called the Stock Act. If they're trading single stocks on the information they have, they only have to pay like a$250 fine.

1:37:06So Nancy Pelosi, Dan Crenshaw, all these people making millions of dollars on the information they have, they just pay a little fine. And so I wonder, you know, I might speak to a conference outside of New York, and all they ask me about is why can Congress do this? Like, 86 % of the country agrees on nothing other than this. Congress should not be able to trade single stocks. So one of my hopes with the book is to be able to talk about how do we get a bill passed where Congress can't trade on inside information. And there's been 25 bills the last 13 years that have tried to stop this. It never makes it to a president's desk here because in the bill, there's a reason.

1:37:47They'll say, oh, if you run for government and you're a private business owner, you have to sell your private business shares. It's like, there's no market for that. Why would I, we want more business people in government. We don't want career politicians. But there's always a way that they kill the bill. So I would love for Congress not to be allowed to do this because it's gross. Here, they get elected, and then years later, their net worths are 10 times, and their salaries are like$175 ,000. I think Donald Trump's son made hundreds of millions here. On Trump coin. Yeah, it's across the board, both parties here.

1:38:18So I think that's something that, like when you think about the politicians, they don't really make money in business after this. They make money on speaking fees, book deals, and insider trading, basically. Why do you think Warren Buffett sold all his stocks? Uh, Buffett just, he's old, he retired. So he has his, he still has a partnership and everything. And he's in his nineties and his partner died, Charlie Mumber. But he's not sitting on Boeing's or something because he sold them. Oh, he is, but he also has the billionaire pledge where he's giving it most of it away. Like his, his kids, I don't know what they get, but he always says his kids aren't going to get, they'll have enough, but they're not going to get everything.

1:38:52He's giving it most of it away. He signed him and Bill Gates and all these guys signed this billionaire pledge where they're going to get most of it away. Cause they don't want the government, you know, the government mishandles it. So has anyone ever reached out to you, who you go sent to prison by being an informant? Um, nobody has actually, I always, I would, I was wonder what people are up to, but most people have scrubbed their Google profile. Like every week for me, I get emails from like reputation management companies, or I guess for a certain price, they'll scrub all the bad stuff off the internet.

1:39:25And I'm like, I send them my, my website and I play with it. like you won't believe tipperx.com, like all the bad stuff's here. And they're like, oh my God, it looks like they're using your name on the website. And they figured out it's me. So why would I, I guess I decided to lean into it. But people are so concerned about their reputation. And so a lot of people just have just scrubbed this off the internet. You know, I guess they don't want to accept responsibility, but. What does tipperx mean? That's my FBI, what the FBI called me these cases. X was a letter in my company's name and then they took that.

1:40:03So of the informants of the 32, it was A to Z and then like a few more letters to get to 32 letters. And so I happen to just be Tipper X. And now I've actually trademarked the word Tipper X. In the next cases, there can't be a Tipper X. How's life now? Life is good. I like having the opportunity to share this story with the public. I always get emails from young professionals saying they'll never forget it. It makes them think about their own decisions. I get people reaching out that just got into prison, they're trying to restart their lives. How do they talk about their own situation? The challenging part for a lot of these guys is accepting responsibility.

1:40:43It's very easy to say, oh, my boss looked the other way, like my case, or oh, I made mistakes when they actually made bad decisions. And if we call our bad decisions mistakes, like we're not owning them. So it's very hard for somebody to say, hey, I made these decisions. Here's what I was thinking. Here's how you can avoid the fate because they're always going to get the little guy. It's good now, but I still struggle sometimes with my own self-talk. Like if I talk to other people the way I talk to myself, I wouldn't have any friends. I'm still kind of hard on myself and I have to keep working on that, but it's sort of passing thoughts.

1:41:22Like I know it's there and it's not, I'm not sure. What's the best advice you've ever had? The best advice? Um,

1:41:35just, just focus on yourself. You know, don't worry about what other people are doing to get ahead. I mean, I wish I would have had that advice back then, but that's what 40 something Tom today would tell 20 something Tom. What's the one thing you want people to get out of this podcast today? When I speak, people come up and tell me their own worst moments. And I would just say, like, your scar, everybody has scars. I mean, mine are as bad as many people's, but your scars can become your service if you lean into it. And I would say, you don't drown by falling in the water, you drown by staying there.

1:42:13And once you get out there, the main thing is just to talk to other people and not stay inside your own head because everybody's going through stuff today. Um, and to have a windshield mentality, like don't look in the past, don't look in the rear view mirror, just look ahead, just be in the moment, be in the present now. Don't worry about the past or the future. For anybody watching Tom, this may be in a life of struggle. What advice would you have for them?

1:42:39So get outside your own head, reach out to people. You can't, you don't have to get through this alone, reach out to people and really just, you have to be able to forgive yourself. And there's a big difference between, so when I started speaking, the FBI was like, go make lemonade of lemons, they called it, or poacher turned gamekeeper, you know, go share this cautionary tale. I was dealing with a lot of shame. Like I spoke at this conference and the event planner said the feedback from the audience was they don't feel you're okay. I'm like, I'm fine. She's like, you're going through a lot of shame, whereas you should keep the guilt, but lose the shame.

1:43:14I said, they're the same thing. She said, no, they're not. She said, shame is I'm a piece of shit and did a bad thing. Guilt is maybe I'm a regular guy and did something bad. She's like, keep the guilt, lose the shame. How are you feeling today, bro? Feeling good. Good. Listen, Tom, would you like to finish up on anything else? Just feel free to reach out to me. It's tipperx.com. The book will be outwired on Wall Street. You know, I get emails all the time for people going through stuff. I'm happy to chat. And my goal, I think, long term is just to be able to still be of service, you know, and hopefully the story just makes people think and maybe they're going through something that they'll take a nugget from that to get through what they're going through.

1:43:58Good luck with the book, and I wish you nothing but the best for the future. Take care. Take care.