Australian financial analyst Trent Martin is suffering "bizarre and cruel" treatment while languishing in abysmal conditions in a Hong Kong jail, his US lawyer says.

Martin, 33, made worldwide headlines late last year when US prosecutors alleged he was a key figure in an insider trading scandal involving computing giant IBM's secret $US1.2 billion ($A1.16 billion) takeover of software company SPSS.

Martin was arrested in Hong Kong on December 23 and just days later agreed to be extradited to New York, but he has remained behind bars in Hong Kong.

"The problem we have encountered is that Mr Martin's extradition has dragged on for over two months, with no imminent end in sight," his New York lawyer Larry Krantz wrote in a letter to US District Court Judge Andrew Carter.

Martin, after agreeing not to fight extradition, would have expected to have been back in the US in January, Washington DC-based international criminal law expert Douglas McNabb told AAP.

Mr Krantz said Hong Kong authorities signed the extradition order on March 1, but the matter is now in the hands of the US Marshals who will be responsible for getting Martin to New York.

Mr Krantz hoped Judge Carter could help expedite the extradition and end Martin's "bizarre and cruel ordeal".

"We note in this regard that his conditions of confinement in Hong Kong have been abysmal and that he had endured enormous and, in our view, unjustified suffering on account of the delay in his extradition," Mr Krantz said.

Martin has been charged with one count of conspiracy to commit securities fraud and one count of securities fraud.

If convicted of both, he faces up to 25 years in a US federal prison and more than $US5 million in fines.

It is alleged Martin, while living in New York in 2009, took confidential information from a New Zealand banker friend, who was working on the IBM-SPSS deal, and bought call option contracts ahead of the public announcement of the takeover.

It is also alleged Martin told his stockbroker flatmate, Thomas C Conradt, about the confidential information and Conradt passed it on to a colleague, David J Weishaus.

While Martin sold some of his SPSS positions after telling his Kiwi friend what he had done, he still yielded $US7,900 from the information, prosecutors allege.

The Kiwi can't be named because he is a key prosecution witness.

Conradt, Weishaus and two others sold their SPSS positions for a total profit of more than $US1 million.

Conradt and Weishaus are also facing charges.

Martin, formerly of Sydney's northern beaches of Sydney, was working at a Connecticut financial firm at the time of the alleged inside trading. He moved to Hong Kong after US authorities began their investigation.

Martin is likely to receive bail when he arrives in New York, with Krantz telling the judge an "agreement in principle" had been reached with US prosecutors.