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Prosecution rests in Rajaratnam trial

Prosecution rests in Rajaratnam trial

After four weeks of presenting evidence against Galleon Group founder, Raj Rajaratnam, the prosecution has rested its case in the biggest hedge fund insider trading cases in the US history.

After four weeks of presenting evidence against Galleon Group founder, Raj Rajaratnam , the prosecution has rested its case in the biggest hedge fund insider trading cases in the US history.

The defence, which is expected to start presenting next week, will try to establish that Rajaratnam's trade was based on research, knowledge of the market, and information already available in the public domain.

The government's last witness, James Barnacle Jr - an FBI agent, testified that Sri Lanka-born Rajaratnam had made more USD 63 million from confidential information he received from insiders.

Barnacle explained that the main accused had made USD 53.8 in profits and avoided losses worth USD 9.9 million.

Earlier, the prosecution had indicated that one-time billionaire had made USD 45 million from insider tips.

Since the start of the trial, Rajaratnam has sat with his team of lawyers, and appears to be listening to the evidence and arguments attentively.

The government has played for the jury secretly recorded phone conversations between Rajaratnam and other alleged conspirators who provided him with confidential information.

Out of 26 people arrested in the case, 19 have pleaded guilty.

Rajaratnam, who is charged with 14 counts of conspiracy and securities fraud, denies wrongdoing.

If found guilty, he faces up to 20 years in prison.

The case also involves three Indian-Americans.

Rajaratnam's old classmates from The Wharton School of the University of Pennsylvania - Anil Kumar, a former McKinsey and Co director and Rajiv Goel, a former Intel Corp executive - pleaded guilty and testified against him.

Kumar testified against him on one of the biggest deals in the case - 2006 acquisition of ATI Technologies, a graphic design company, by Advanced Micro Devices, a microchip- processing company, which allegedly led to profits of more than USD 20 million.

Goel, who described Rajaratnam as "a good pal," testified that he spilled the beans on Intel's plan to invest USD 1 billion in a new joint venture between Clearwire Corp and Sprint Corp.

At the start of the trial, Assistant US Attorney Jonathan Streeter said that Rajaratnam "knew tomorrow's business news today and traded on it."

Published on: Apr 07, 2011, 8:34 AM IST
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