Federal authorities announced at a press conference on Wednesday that seven individuals were brought up on insider trading charges as part of a five-year investigation by the Justice Department.

Authorities arrested individuals across the country, from New York to California. Prosecutors allege that the individuals received insider tips from Dell that netted them a total of $61.8 million.

This is, by now, a sadly familiar story, but no less disturbing for those who believe that everyone should play by the same set of rules, said Southern District of New York U.S. Attorney Preet Bharara. Out of the seven men charged, three pleaded guilty. The men were allegedly friends who formed a criminal club, said Bharara.

It was a club where everyone scratched everyone else's back, he said. Authorities said Sandeep Sandy Goyal, a former junior technology analyst at Neuberger Berman, received information from an unidentified source inside Dell. According to the complaint, from 2003 to 2006, Goyal had worked at Dell at their headquarters. In 2008 and 2009 the Dell insider, who allegedly was an employee in the investor relations department, fed Goyal data about how the company would perform.

The charges at their core describe a circle of corruption and a cycle of greed, said Bharara. Bharara outlined the scheme in which Goyal would pass the insider information along Jessie Tortora. Tortora in turn would share the information with Jon Horvath, Spyridon Sam Adondakis and Danny Kuo. In 2008, Tortora also shared the information with Todd Newman of Diamondback Capital Management LLC before Dell announced its first-and second-quarter earnings. He netted approximately $3.8 million.

Newman took the information and shared it with Level Global Investors LP co-founder Anthony Chiasson.

Chiasson netted a staggering $53 million in a windfall by massively shorting Dell's stock, said Bharara. The game was rigged.

The arrests were part of an investigation called Operation Perfect Hedge by the Justice Department. The operation has seen charges brought against 56 individuals with more than 50 pleading guilty or being convicted, including Galleon Group LLC co-founder Raj Rajaratnam, who is serving 11 years in prison for insider trading.

Each wave of charges seems to produce leads that lead us to the next phase, said Janice Fedarcyk, the assistant director of the FBI's New York office.When you have the answer sheet beforehand it is pretty hard not to cheat on the tests,

Fedarcyk explained that Goyal worked with Adondakis and Tortora, who was friendly with Kuo. Their friendship and business partnerships were the catalyst that urged these men to share their information and cheat the system, explained Fedarcyk.

Goyal would not give up the information for free, said authorities. He charged approximately $175,000 for insider tips. Still, all of the co-conspirators were able to make a substantial amount of money. Authorities also said that Kuo had inside information on technology company Nvidia. He allegedly passed on that information to Tortora, Adondakis and Horvath.

Tortora, Goyal and Adondakis pleaded guilty and are cooperating with officials.

Once again so-called white-collar professionals, who should know better, disregard the most basic wisdom we teach our children, said Robert Khazami, director of the Securities and Exchange Commission's Divison of Enforcement. Khazami announced that the SEC had filed a civil suit against the individuals and their companies.

The charges unsealed today describe a tight-knit circle of greed and confidential business information, all to obtain an illegal inside-edge over ordinary law-abiding investors, said Bharara. Insider trading activity in recent times has become rampant and routine, he added, noting that, this criminal behavior was known and encouraged--and was exploited by several investment firms.