Raj Rajaratnam, the hedge funder found guilty of orchestrating one of the United States’ largest insider-trading schemes back in May, maintains that it was all some kind of misunderstanding. Rajaratnam will be sentenced later this month, and is currently facing up to 24 years in jail for fourteen counts of securities fraud and conspiracy. His lawyers have argued that that’s too much, considering the “victimless” nature of his crime. However, the Galleon Group founder sort of disagrees. As he reportedly told a probation officer on September 9, the scheme did have one victim: clueless ol’ Raj Rajaratnam.
“In my own mind, the line between permissible ‘detective work’ and impermissible insider trading was not always clear, especially with regard to companies broadly covered by the news media as to which there was a wealth of publicly available information, including frequent leaks, rumors and speculation about corporate transactions and other important developments.”
In a legal brief prepared for Judge Richard Holwell, who is overseeing the case, prosecutors pointed to the comments as proof of “a serious disregard for the law” and therefore deserving of a longer sentence. Similarly, they cited Rajaratnam’s claim that “All of Galleon’s investors were made whole after Galleon closed down” as a sign that he has “absolutely no appreciation” for the extent to which he “cheated the system.” It’s almost like everyone knows something that Raj Rajaratnam doesn’t, and they’re all using that knowledge against him! There is a word for this, but it’s not “ironic.”
Galleon’s Rajaratnam May Face Stiffer Jail Sentence After Questioning Law [Bloomberg]