As SEC Enforcement Director Rob Khuzami said today, “If you find yourself chewing the card of a cell phone…something has gone terribly wrong.”

Indeed. The SEC filed a huge insider trading case today against two lawyers, six Wall Street traders and a proprietary trading firm, alleging that the scheme netted over $20 million. The SEC alleges that Arthur J. Cutillo, an attorney in the New York office of law firm Ropes & Gray, had access to confidential information about at least four major proposed corporate transactions in which his firm’s clients participated. Through his friend, attorney Jason Goldfarb, Cutillo tipped this inside information to Zvi Goffer, a trader at New York-based firm Schottenfeld Group.

Goffer, allegedly known as “the Octopussy” within the insider trading ring because he had his arms in so many sources of inside information, in turn tipped four traders at three different broker-dealer firms and another professional trader Craig Drimal, who each then traded either for their own account or their firm’s proprietary accounts. Also, notably, Goffer allegedly went to work at … wait for it… Galleon Group from January 2008 through August 2008.

Goffer and the lawyers allegedly went to great lengths to keep their communications secret, even using disposable cell phones. The SEC says that prior to the announcement of one acquisition,

Goffer gave one of his tippees a disposable cell phone that had two programmed phone numbers labeled “you” and “me.” After the announcement, Goffer destroyed the disposable cell phone by removing the SIM card, biting it, and breaking the phone in half, throwing away half of the phone and instructing his tippee to dispose of the other half.

Goffer, Cutillo, Goldfarb and others were also named in a criminal complaint filed today by the U.S. Attorney for the SDNY.