Rajaratnam`s secretly recorded phone calls released
Prosecutors in the US` biggest insider trading case have released tapes of conversations between main suspect Raj Rajaratnam and four of his alleged co-conspirators.
New York: Prosecutors in the US` biggest
insider trading case have released tapes of conversations
between main suspect Raj Rajaratnam and four of his alleged
co-conspirators, including two of Indian origin, in which he
was allegedly receiving or directing stock tips.
The secretly recorded telephone calls of 53-year-old Sri
Lanka-born billionaire Rajaratnam, the Galleon group founder,
with Anil Kumar, a former director at McKinsey; Rajiv Goel, an
ex-Intel executive; and Adam Smith and Ian Horowitz who worked
for his hedge fund; had been played by the prosecutors.
"Hey Raj... so yesterday, they agreed on ... at least
they`ve shaken hands on and said they`re going ahead with the
deal," Kumar told Rajaratnam, his ex-Wharton classmate,
according to the tapes available on the website of American
media outlets. "So I think you can now just buy."
Kumar testified in court on Thursday that in 2003
Rajaratnam had asked him to work as his consultant, and
transferred USD 500,000 a year into a Swiss bank account in
exchange for confidential information about McKinsey every
four to six weeks.
"Mr Rajaratnam kept asking me for that information and I
felt that I owed him something given how much money he was
paying me," Kumar told the jury on the third day of the trial.
Kumar, 52, has already pleaded guilty to providing
secret information to Rajaratnam from 2003 to 2009, including
a tip off on the acquisition of ATI Technologies Inc. by
Advanced Micro Devices Inc.
Rajaratnam, who is charged with 14 counts of security
fraud and conspiracy, could face up to 20 years in prison.
While he denies any wrongdoing, 19 people have pleaded guilty
in the case, including Goel and Smith.
Another Indian-American Rajat Gupta, a former board
member of Goldman Sachs and Proctor & Gamble, was charged last
week by the Securities and Exchange Commission for sharing
confidential information with Rajaratnam.
John Dowd, Rajaratanam`s lawyer, has asserted that Kumar
had hidden from McKinsey the money he received from Rajaratnam
for above-board consultations, and that Kumar was guilty of
tax evasion for five years.
On Wednesday, Dowd said that Kumar was now trying to pin
his client and "get a free pass from the government."
Dowd also told the jury that those witnesses who have
pleaded guilty but not been sentenced are on a "leash" held by
He said that all the information used by Rajaratnam was
already in the public domain, and his client excelled in
The central question of the case is whether Rajaratnam
earned USD 45 million by using leaked confidential
information. However, Rajaratnam says his strategies were
based on "public information".