Wednesday, May 11, 2011

Hedge Fund Founder Convicted of Insider Trading

Raj Rajaratnam, founder of the Galleon Group, was found guilty Wednesday by a jury in New York of conspiracy and securities fraud. Having cultivated a series of contacts in various corporations, he used this illegally obtained information to make more than $60 million in profits and avoided losses.

Prosecutors say this is the largest insider trading case ever involving hedge funds. Rajaratnam faces a maximum term of more than 19 years in prison.

U.S. Attorney Preet Bharara said the verdict sends a message that white collar laws apply to everyone, "no matter how much money you have."

The defendant "was among the best and the brightest, one of the most educated, successful and privileged professionals in the country," Bharara said in a statement. "Yet, like so many others, he let greed and corruption cause his undoing."

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