Raj Rajaratnam fined record $92.8m by SEC

10 November 2011

The Securities and Exchange Commission (SEC) has fined Galleon Group founder Raj Rajaratnam a record $92.8 million for insider trading.

Rajaratnam was found guilty of 14 counts charged including nine of securities fraud and five of conspiracy to commit securities fraud on 11 May 2011.

He was sentenced to 11 years in prison and ordered to pay a total of $63.8 million in fines and restitution after a jury verdict.

Robert Khuzami, director of the SEC’s Division of Enforcement, said: “The penalty imposed today reflects the historic proportions of Raj Rajaratnam’s illegal conduct and its impact on the integrity of our markets.”

The Galleon Group founder was originally targeted by the SEC in October 2009 when it brought civil charges against him.

Its complaint was amended a month later and in January the following year with the investigation eventually leading to civil charges being filed against 29 individuals.

Over $52 million in illicit gains are believed to have been made through the insider trading schemes while the total amount of monetary penalities imposed on Rajaratnam now stands at $156.6 million.

By Jim Ottewill

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