Rajaratnam agrees to pay Rs1.5 million in civil suit
27 Dec 2012
Raj Rajaratnam, co-founder of US hedge fund Galleon Group LLC, has agreed to pay $1.5 million to settle a civil case brought by the US Securities and Exchange Commission (SEC), and to waive his right to appeal the judgment.
Rajaratnam agreed to pay $1.3 million, representing profits gained and losses avoided as a result of the conduct the SEC alleged in the case, according to a filing on Wednesday in a federal court in New York. He will also pay $147,738 in interest.
Rajaratnam would make the payment, representing the profits obtained by unlawful means, to the SEC within 90 days after the entry of the final judgment in court records, according to the filing.
Rajaratnam is currently serving an 11-year jail sentence after he was convicted in May 2011 of securities fraud and conspiracy. He was found guilty of directing the biggest hedge fund insider-trading scheme in US history by running a network of friends and associates who leaked corporate secrets to him for years.
At the trial, the government introduced 45 wiretap recordings, along with documents and testimony derived from the wiretaps.
The agreement on Thursday stems from a civil case in which Rajaratnam is a co-defendant with one of his alleged sources of illicit information, former Goldman Sachs Group Inc director Rajat Gupta, who was sentenced to two years in prison for insider trading.