12 May, 2011
Rajaratnam guilty of insider trading Raj Rajaratnam, the hedge fund billionaire and former Head of Galleon Group, has been convicted guilty of insider trading on all 14 counts of securities scam and conspiracy charges. After 12 days of deliberations, Rajaratnam was yesterday found guilty of making $63 million in scams by trading inside information about earnings announcements and corporate takeovers, and now faces up to 19½ years in prison when he is sentenced on July 29. In addition, Richard Holwell, the Manhattan federal judge who is overseeing the case, ordered Rajaratnam to wear an electronic monitoring bracelet and confined him to his Manhattan home while awaiting sentencing. The verdict marks a significant win for the US attorney's office in Manhattan, which has brought the scam case up as part of a broader crackdown on insider trading scams. The Rajaratnam case was their largest insider-trading probe in a generation and involved unusual investigative tactics including wiretaps. The investigation has evolved additional criminal charges against more than two dozen financial professionals, many of whom have already pleaded guilty. "The message today is clear: there are rules and there are laws, and they apply to everyone, no matter who you are or how much money you have", said Preet Bharara, the Manhattan US attorney.
