May 5, 09

NEWS / Three Defendants Charged with Insider Trading Former Citigroup Investment Banker was “Tipper” in

SAN FRANCISCO�A federal grand jury in San Francisco returned a 38 count indictment against three Bay Area defendants charging securities fraud and conspiracy relating to an insider trading scheme in which the defendants made profits in excess of $5.3 million, United States Attorney Joseph P. Russoniello announced.

The indictment, which was unsealed today, names: Maher Fayez Kara, 37, of San Carlos, Calif., a former investment banker at Citigroup Global Markets, Inc. in New York; Maher Kara�s brother, Mounir Fayez Kara, 48, also known as Michael F. Kara, of Walnut Creek, Calif; and Emile Youssef Jilwan, 54, of Pleasanton, Calif.

According to the indictment, Maher Kara misappropriated material, non-public information about confidential corporate acquisitions, financings and other transactions in New York, in violation of his fiduciary duty and duty of trust and confidence to Citigroup and its clients. He then tipped his brother, Mounir Kara about the confidential transactions. Mounir Kara and Jilwan are charged with then trading on the material, non-public information. The defendants are charged with illegally trading in the securities of about 15 publicly-traded companies from 2004 through 2007�mostly in the biotechnology sector.

�Today�s economy has made the stock markets volatile at best; their integrity depends on professionals acting within the law,� Russoniello said. �When individuals violate their fiduciary duty, trade using illegally gained information and break the law, they will be prosecuted.�

Mounir Kara and Jilwan are also charged with conspiracy and obstruction relating to false and misleading statements that they made to the Securities and Exchange Commission during its parallel investigation of this matter.

The indictment also seeks asset forfeiture in excess of $5.3 million in proceeds that the defendants obtained from their criminal conduct.

Citigroup was one of the victims of the charged criminal conduct and has cooperated in the investigation conducted by the United States Attorney�s Office and the Federal Bureau of Investigation.

The three defendants surrendered to the FBI this morning and made their initial appearance in federal court in San Francisco earlier today. Maher Kara was released on a $100,000 bond; Mounir Kara was released on a $100,000 bond; and Jilwan was released on a $100,000 bond. The defendants next scheduled appearance in district court is at 10:00 a.m. on May 18, 2009 before Judge Marilyn H. Patel.

The maximum statutory penalty for each count of securities fraud in violation of 15 U.S.C. � 78ff is 20 years and a fine of $5 million, plus restitution if appropriate. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. � 3553.

Adam A. Reeves is the Assistant U.S. Attorney who is prosecuting the case. The prosecution is the result of a 20 month investigation by the FBI. The United States Attorney�s Office wishes to recognize the assistance of the Division of Enforcement of the SEC�s San Francisco Regional Office.

Please note, an indictment contains only allegations against an individual and, as with all defendants, Maher Kara, Mounir Kara and Emile Jilwan must be presumed innocent unless and until proven guilty.