Raj Rajaratnam was found guilty Wednesday of 14 conspiracy and securities fraud charges of insider trading. Rajaratnam is the founder of Galleon Group, a head fund. He remains free on bail until sentencing on July 29. he faces 15 1/2 to 19 1/2 years in federal prison.
NEW YORK (Reuters) – Galleon Group hedge fund founder Raj Rajaratnam was found guilty on all 14 conspiracy and securities fraud charges of insider trading on Wednesday, in a vindication of the government’s aggressive tactics in prosecuting crime on Wall Street.
Rajaratnam, a one-time billionaire, will remain free on bail until sentencing on July 29, U.S. District Judge Richard Holwell ruled after the jury delivered its verdict.
Rajaratnam was expressionless during the verdict reading by a courtroom deputy.
He could face 15-1/2 to 19-1/2 years in a federal prison under sentencing guidelines, prosecutors said.
The Manhattan federal jury announced its unanimous verdict on the 12th day of deliberations in what many legal experts said was a strong prosecution case using FBI phone taps and testimony of three former friends and associates of Rajaratnam.
The jury convicted Rajaratnam of nine counts of securities fraud and five counts of conspiracy for what prosecutors describe as the money manager’s central role in the most sweeping probe of insider trading at hedge funds on record.
During the two-month trial, prosecutors hammered at their argument that Rajaratnam cheated to gain an unfair advantage in the stock market from 2003 to March 2009, reaping an illicit $63.8 million.
Defense lawyers had stuck consistently to their main theme that Rajaratnam’s trades were guided by a trove of research and public information, not secrets leaked by highly-placed corporate insiders.
Sri Lankan-born Rajaratnam, 53, was ordered to be fitted with an electronic monitoring device while out on bail.
Prosecutors had asked the judge to jail Rajaratnam pending sentencing, but the judge rejected that request.
The case is USA v Raj Rajaratnam et al, U.S. District Court for the Southern District of New York, No. 09-01184.
(Reporting by Grant McCool, Basil Katz and Jonathan Stempel, editing by Dave Zimmerman)