A jury has been selected to hear the insider-trading trial of Galleon Group founder Raj Rajaratnam, according to published reports, including this article in the Wall Street Journal.Rajaratnam is accused of making improper trades based on alleged tips about publicly traded firms obtained from company insiders and others. Mr. Rajaratnam has denied wrongdoing.
After a day and a half of questioning, seven women and five men were chosen to serve on the panel. Six alternate jurors also were chosen.
Mr. Rajaratnam is among 26 people charged in a broad criminal insider-trading probe; 19 people have pleaded guilty in the investigation.
His trial, on 14 counts of conspiracy and securities fraud, is expected to last about 10 weeks. Opening statements are expected later today.
What I don't get is why I never heard of this guy before. Did the Zeitgeist miss him, or did I miss the Zeitgeist? (I have been busy lately.)
According to Pavlo, "Judge Holwell is noted for being tough on insider trading violators. In 2008 he sentenced 28 year-old Eugene Plotkin (formerly of Goldman Sachs) to 57 months in prison…and Plotkin pled out without a trial! The amount associated with Plotkin’s case was a mere $6 million, Raj’s case involves much larger dollar amounts (alleged to be $45 million….or roughly what Raj will spend on his defense team). If found guilty, look for a stiff penalty. The same judge also presided over Martha Stewart’s civil case but that was settled prior to going to trial ($195,000 fine and not serve as director for public company for 5 years).
Pavlo continued: "A subtle victory for the defense also happened today. Judge Holwell said he would instruct the seated jury that they may convict Rajaratnam only if he knew his alleged tipper had breached a legal duty owed to the company from which the news emanated. This could make it a more difficult case for the government to prove since most of the “tips” probably did not begin with a preamble that “this information is a violation of my fiduciary duty”. However, with so many taped conversations, there is plenty of damning information to be presented.
"Say what you will about Raj Rajaratnam, but today had to be a lonely and frightening moment for the defiant billionaire. Colleagues and friends are lined up to testify against him, some of those heading to prison themselves. For Raj, these are going to be some painful weeks."
After a day and a half of questioning, seven women and five men were chosen to serve on the panel. Six alternate jurors also were chosen.
Mr. Rajaratnam is among 26 people charged in a broad criminal insider-trading probe; 19 people have pleaded guilty in the investigation.
His trial, on 14 counts of conspiracy and securities fraud, is expected to last about 10 weeks. Opening statements are expected later today.
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Judge Holwell is noted for being tough. |
Raj Rajaratnam, the Sri Lankan-born founder of the hedge fund Galleon, has become the focus of the most high-profile insider-trading case in a generation. Or, as Walter Pavlo writes on his Forbes blog, White Collar Crime,
"... the case against Raj Rajaratnam [is] the largest insider trading case in decades. Of the 26 people indicted, 19 have already pleaded guilty to being a part of an insider trading scheme with the Galleon Group leader, Raj, who is at the center of the investigation."
What I don't get is why I never heard of this guy before. Did the Zeitgeist miss him, or did I miss the Zeitgeist? (I have been busy lately.)
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Raj Rajaratnam, Bloomberg News |
"The defense’s worries about Raj’s ability to get a fair trial seemed unfounded as only a few of the jury pool were familiar with the case or Raj."
So it's not just me. Why would a trial of this magnitude, when the spotlight on Wall Street cheats like this Raj guy (allegedly) is so bright, be kept a virtual secret?
Pavlo continued: "A subtle victory for the defense also happened today. Judge Holwell said he would instruct the seated jury that they may convict Rajaratnam only if he knew his alleged tipper had breached a legal duty owed to the company from which the news emanated. This could make it a more difficult case for the government to prove since most of the “tips” probably did not begin with a preamble that “this information is a violation of my fiduciary duty”. However, with so many taped conversations, there is plenty of damning information to be presented.
"Say what you will about Raj Rajaratnam, but today had to be a lonely and frightening moment for the defiant billionaire. Colleagues and friends are lined up to testify against him, some of those heading to prison themselves. For Raj, these are going to be some painful weeks."
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