Rajaratnam Brother Settles Insider Trading Charges Involving Hedge Fund Advisory Firm Galleon Management
Rajarengan “Rengan” Rajaratnam, the brother of Raj Rajaratnam, has consented to pay over $840,000 to settle insider trading charges filed, against him by the U.S. Securities and Exchange Commission. Rengan, who has not admitted to or denied wrongding, also has agreed to an industry bar. A court must still approve the settlement.
Rengan was a portfolio manager at Galleon. He also co-founded Sedna Capital Management, which is another hedge fund advisory firm. Raj was convicted of insider trading in 2011.
It was in 2013 that the SEC filed charges against him for his involvement in the insider trading scam conducted by his brother Raj and Galleon Management.
According to the Commission from 2006 to 2008 Raj, who was a Galleon founder, repeatedly gave Rengan insider data. The latter made over $3 million in illicit gains for himself and the funds that he managed at Sedna Capital and Galleon. Rengan also purportedly worked with his brother to nurture highly-placed sources and obtain confidential information so that they would benefit over other traders. Some of his illicit trades are said to have involved securities of Hilton Hotels, Akamai Technologies, Polycom and others. Rengan, however, was acquitted in the criminal case against him.
The financial scheme involved securities in over 15 companies that resulted in illicit gains of close to $100 million. To date, the regulator has settled or obtained court order judgments in enforcement actions related to the Galleon fraud against 35 defendants. Some $165 million in monetary sanctions have resulted thus far.
Rajaratnam’s Brother Settles SEC Lawsuit for $841,000, Bloomberg, October 23, 2014
Rengan Rajaratnam's Prosecutors Had Concerns About the Case, The Wall Street Journal, July 9, 2014
More Blog Posts:
Galleon Group Founder’s Brother Pleads Not Guilty to Insider Trading, Institutional Investor Securities Blog, April 2, 2013
Ex-Goldman Sachs Board Member Accused of Insider Trading with Galleon Group Co-Founder Seeks to Have SEC Administrative Case Against Him Dropped, Institutional Investor Securities Blog, April 19, 2011
Galleon Group LLC Co-Founder Raj Rajaratnam Sentenced to 11 Years in Prison Over Insider Trading Scam, Stockbroker Fraud Blog, October 13, 2011