Picture: 123RF/KASTO
Picture: 123RF/KASTO

London/Paris — The coroner ruled it “death by misadventure”. By the time the concierge reached James Harris last June, he was lying in the hallway outside his apartment, arms and legs shaking, gasping for air. Although an ambulance crew raced in and administered an antidote for opiate overdoses, Harris’s pulse returned only briefly. Three minutes later, the 42-year-old British trader was dead.

Harris had been troubled for months, behind on his rent, drinking and using copious amounts of cocaine in his apartment not far from London’s Buckingham Palace, witnesses said in statements read at his inquest. While searching his apartment, police found crack pipes, sedatives and a mobile phone. When they lifted his body to wheel it to the ambulance and drive it to the morgue, a second phone dropped out of the dead man’s pocket.

Mobile phones were Harris’s main work tools. The one that fell out of his pocket was one of probably dozens he had used over the years and then discarded to avoid being traced. Through calls, texts and encrypted messaging apps, Harris plugged into a loose network of day traders on two continents who cultivated sources at banks and companies to procure an edge on large deals. They exchanged secrets on corporate takeovers, profit warnings and medical trials, trading on the information to generate what prosecutors say were hundreds of millions of dollars in profit.

Since Harris’s death, more details about different parts of the network have emerged in court proceedings. A few days after he died, his friend Walid Choucair was convicted of insider trading in London. Marc Demane Debih, a Geneva-based trader arrested in Serbia and extradited to the US, pleaded guilty and testified in a New York court in January that he got tips from a Goldman Sachs banker and from other insiders via a French art dealer.

Telemaque Lavidas, son of a pharmaceutical-company director who wasn’t implicated in the scheme, was convicted of leaking company secrets to one of Demane Debih’s trading partners, who prosecutors say was also part of the insider-trading network.

A reconstruction of Harris’s life, based on interviews with people who knew him, helps fill in some missing pieces of the puzzle. More than a trader, Harris was a middleman, trafficking in information for a slice of future profits. He jealously guarded his sources, often exaggerated and sometimes provided false information, the friends say.

Harris had been tripped up long before Choucair, Demane Debih and Lavidas. He was arrested in the US in 2012, pleaded guilty to securities fraud and agreed to go back to the UK rather than face prison in New York. He promised the judge that his days of trafficking inside information were over. In his decision, the judge said he was sure Harris had changed his ways.

But it didn’t take long for Harris to fall back in with his old crowd. The lure of money and the things it could buy — a vintage red Ferrari, expensive cigars and cocaine — was apparently too hard to resist for an optician’s son who started out as a tea boy at the London Stock Exchange. It had been a wild ride from that lowly beginning to the high-flying trader’s life, according to people who knew Harris and requested anonymity to speak about their dead friend.

Living the high life

At some point, Harris started mingling with a group of traders who shared tips, made millions and partied at glamorous clubs or on yachts docked off Monaco. He enjoyed the life, his friends said, and had a magnetic personality.

He also had a dark side: one trader described him as an aggressive lout. Covered in tattoos strategically placed to be hidden by a dress shirt and pants, he was an odd figure among the traders who frequented celebrity hangouts such as the Chiltern Firehouse and members-only Tramp in London, or Les Caves du Roy in Saint Tropez, people who knew him said.

While others talked about financial markets long into the night, Harris preferred to discuss music and art, introducing friends to hip-hop records produced by the Salazar Brothers and street artists Paul Insect and Banksy.

At his trial, Choucair described how the traders operated, and others in the group confirmed their methods. They were careful to avoid detection, speaking on burner phones that they replaced after a few months. They bought contracts for difference (CFDs), a leveraged bet on a stock’s movement that meant gains and losses could be far higher than the initial investment. The group, a loose association more than a ring, became expert at ferreting out mergers and acquisitions.

Demane Debih’s testimony shed light on the value of intermediaries. He said he paid $12m to French art dealer John Dodelande for tips from London investment bankers to insulate him from their source. Dodelande hasn’t been charged with any wrongdoing.

Once they’d built their positions, Harris, Choucair, Demane Debih and others would call journalists, including some at Bloomberg News. They were betting that if the reporters wrote a story, the stock would move and the traders could cash out. Bloomberg’s policy is not to publish any information without confirming it with people who have direct knowledge of the matter. The policy also prohibits telling sources if or when a story will be published.

In 2011, Harris left London, flew to New York and took up residence at the swanky Mercer Hotel. Seeing him whizz off in a flashy car one day, a 22-year-old US woman named Michelle Gomolin slipped the doorman her number and asked him to pass it along. Six months later they married and moved into an apartment in SoHo, embarking on a roller-coaster ride that even then Harris said he wanted to turn into a movie, Gomolin wrote in an Instagram tribute after he died.

“You took me on this ride for years and years, a ride that I could never get off of,” Gomolin, who eventually divorced Harris, wrote. “You were the highest highs and the lowest lows. The best of times and the worst of them too. You were the most lavish, insane, larger-than-life human I have ever met. You walked as if you owned the world, and to me you were my entire existence. Your quirks and oddities never ceased to amaze me.”

Within a year of their marriage, Gomolin was posting $20,000 bail to get Harris out of jail. He had been arrested by FBI agents for securities fraud, but he’d also become entangled in an international scandal involving the son of a former president of Kyrgyzstan.   

Harris had been providing trading tips to Eugene Gourevitch, who ran a $45m securities account for the former leader’s son, Maksim Bakiyev. Gourevitch was arrested in 2011 and agreed to co-operate with the Justice Department to dismantle the insider-trading network.

Gourevitch said in an interview that he was introduced to Harris by friends who told him he had access to insider information. “Harris bragged he knew lawyers and bankers but never mentioned specific names to protect his source of income,” Gourevitch said. “Sometimes Harris’s information was spot on, at other times it was completely wrong.”

To help US investigators, Gourevitch began recording conversations with suspects, including Harris and his friend Tayyib Ali Munir, then a trader at Brown Brothers Harriman. During one conversation in early 2012, Munir told Gourevitch he could provide corporate earnings reports ahead of publication if Bakiyev agreed to pay $122,000 for previous tips, according to court documents. Munir also boasted that some of the information came from a former director of the New York Stock Exchange.

Munir didn’t supply the promised releases, and it’s unclear if he had a source at the exchange. But Harris came through a few weeks later. A day before Russian wireless company VimpelCom  reported a net loss, he gave Gourevitch the statement the company was planning to publish. He told Gourevitch to short VimpelCom and pay him half the profit, which would have netted Harris about $1m. Gourevitch didn’t make the trade, but he paid Harris $50,000 anyway.

Harris and Munir were both arrested and pleaded guilty. Harris was sentenced to two years of supervised release, and Munir three. Harris was ordered to forfeit the $50,000 and a Ducati motorbike he bought with proceeds from the securities fraud. Gourevitch got five years. Charges against Bakiyev were dropped a few months later without explanation. Munir and a lawyer for Bakiyev didn't respond to requests for comment.

“No fines were imposed because the defendant does not have any assets, and it is unlikely that he will have any in the foreseeable future to pay a fine,” judge Jack Weinstein wrote about Harris in his decision. “It is unlikely that the defendant will engage in further criminal activity in light of his sincere remorse.”

Harris returned to the UK and rented an apartment in St James’s, an exclusive neighbourhood between Buckingham Palace and Piccadilly Circus that is home to London’s finest tailors. Choucair testified during his trial that he was still exchanging tips with Harris in late 2013, and call logs between the two presented to the jury showed they spoke frequently before Choucair bought CFDs for property group BRE Properties.

The jury found Choucair’s friend Fabiana Abdel-Malek, a compliance officer at UBS at the time, guilty of leaking confidential information about an acquisition of BRE to Choucair. No-one alleged Harris did anything wrong.

Harris resurfaced again in London’s day-trading scene in 2016, according to two people who interacted with him, then went silent during a spell in the Caribbean. He got back in touch early in 2019, touting stocks and asking old friends to invest on his behalf as a way of circumventing margin limits or disguising bets.

He claimed to have information about an alleged takeover of French chemical company Arkema, showing what turned out to be a forged offer document, one of them said. In what would turn out to be his last trade, in mid-May, he persuaded some of the same people to buy derivatives on his behalf linked to the share price of At Home Group, a US home-decor retail chain.

With At Home, Harris again showed what he said was a detailed copy of a takeover offer, according to one of the people. That document, too, turned out to be doctored, though it wouldn’t become apparent until a few days after Harris’s death, when the company slashed its profit outlook and shares lost more than half their value. Because the trades were done informally, Harris’s friends who suffered losses on his bet had no claim on his estate.

A few days after Harris died, his red Ferrari was parked outside the Greek Orthodox Saint Sophia’s Cathedral in London, where his family and friends gathered in a haze of incense. His body lay beneath a gold mosaic dome with an image of Jesus crouching before a rainbow. His coffin was decorated with images of skyscrapers. Friends and family filed past, leaning in to kiss him, hold his hand or caress his cheek. Those who spoke described a mischievous prankster, a restless soul filled with energy and tenderness, on a mission to sample the best the world had to offer.

“Only you, James, could live in a five-star hotel,” a former girlfriend, Olcay Gulsen, said between sobs. “So lavish. The cool cars, the cigars, everything. But that’s not what made you so special. It was your heart, James.”

In October, in a coroner’s court above a bustling food market in West London, authorities said they found nothing suspicious about Harris’s demise: he had been alone at home that Monday morning, and video surveillance footage showed no-one coming or going. His sister Emily wept as the coroner found that an overdose had killed her brother. The coroner called it death by misadventure — not a suicide, not an accident, not at the hands of someone else, but the result of a risk taken voluntarily.  

Bloomberg