LA Times: Hedge-Fund Manager Raj Rajaratnam Should Be a Warning to Wall Street
According to theLA Times, Wednesday's conviction of hedge-fund manager Raj Rajaratnam should serve as a warning to Wall Street that the citizens of the U.S. are hungry for accountability and that the law applies to everyone - even billionaires.
Preet Bharara, the United States attorney for Manhattan, agrees. In a May 11 article published by the NY Times, Bharara said: "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."
Rajaratnam, a native of Sri Lanka, founded New York-based Galleon Management LP, one of the world's largest hedge funds prior to Rajaratnam's arrest. On Oct. 16, 2009, Rajaratnam was arrested at his home in Manhattan and charged with 14 counts of securities fraud and conspiracy. The same day, the SEC charged Rajaratnam and his firm "with engaging in a massive insider trading scheme that generated more than $25 million in illicit gains."
In his defense, Rajaratnam's attorneys claimed he was "simply doing the sort of research that is the hallmark of successful Wall Street firms" (LA Times). Unfortunately for the defendant, the jury didn't buy it. Prosecutors were able to prove that Rajaratnam's firm "routinely" violated securities laws, and, on Wednesday, the jury found Rajaratnam guilty on all 14 counts.
Rajaratnam's sentencing is scheduled for July 29; he will remain on house arrest and electronic monitoring until then. He faces up to 25 years in prison.