N.Y. sentencing of Canadian insider trader delayed

Mon Nov 23, 2009 4:09pm EST
 
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NEW YORK (Reuters) - A Canadian attorney behind what U.S. prosecutors describe as the largest insider trading scheme in Canadian history was denied entry to the United States and could not be sentenced on Monday.

Canadian Stanko Grmovsek admitted in a Toronto court earlier this year to making $9 million with a law school friend in a 14-year illegal scheme, including laundering money by gambling wads of cash on games such as blackjack in Las Vegas's world-famous casino strip.

U.S. District Judge Naomi Buchwald delayed Grmovsek's sentencing after Grmovsek's lawyer, Paul Calli, said Grmovsek was unable to cross the Canadian border.

Grmovsek, 40, pleaded guilty in October in Manhattan federal court to conspiracy to commit securities fraud.

He is due to be sentenced in Canada on January 7.

At a November 6 hearing in Toronto, lawyers for the prosecution and the defense asked a Canadian judge to delay imposition of a sentence until January, partly to facilitate his ability to get to New York for the U.S. hearing.

A spokeswoman for the Ontario Securities Commission did not immediately return a call seeking comment.

Grmovsek has previously said that he and his friend Gil Cornblum, a Toronto lawyer, made their money from Grmovsek buying stocks based on acquisition tip-offs from Cornblum.

After cooperating with investigators, Cornblum committed suicide by jumping off a highway bridge.

Grmovsek said he transferred profits from offshore accounts to casinos in Las Vegas and the Bahamas where he would bet on sporting events or play blackjack and cash in piles of chips.

(Reporting by Edith Honan; additional reporting by Jonathan Stempel in New York and Pav Jordan in Toronto; editing by Andre Grenon)