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Revision as of 19:13, 19 October 2009 by RichardBond (talk | contribs) (→Background and Career)(diff) ← Previous revision | Latest revision (diff) | Newer revision → (diff)| Raj Rajaratnam | |
|---|---|
| Born | 1957 Colombo, Sri Lanka |
| Occupation(s) | Finance, Hedge Fund, Entrepreneur, President |
| Spouse | Asha Pabla |
| Children | Three |
Raj Rajaratnam is the founder of Galleon Group, a New York based hedge fund. On Oct16, 2009 he was arrested by the FBI for insider trading. Jim Walden, an attorney for Mr. Rajaratnam, said his client is innocent and will fight the insider-trading charges.
Background and Career
He was born in Sri Lanka, attended St Thomas College, Mount Lavinia, then moved to England to complete his schooling, and studied engineering at the University of Sussex in England. Rajaratnam earned an M.B.A. from Wharton School of the University of Pennsylvania in 1983. He is married with three children. Rajaratnam, a Tamil self-made billionaire hedge fund manager, is the 236th richest American according to Forbes Magazine (2009). with an estimated net worth of $1.8 billion. He was ranked 262nd richest American in 2008 and as of early 2009, is the richest Sri Lankan in the world. As of 2009, his Diversified Fund has returned 22.3%, outperforming the Nasdaq by 33%.
Rajaratnam started his career as a lending officer at the Chase Manhattan Bank where he made loans to high-tech companies. He joined the investment banking boutique Needham & Co. as an analyst in 1985, where his focus was on the electronics industry. He became the head of research in 1987 and the president in 1991, at the age of 34 . At the company’s behest, he started a hedge fund, Needham Emerging Growth Partnership in March 1992, which he later bought and renamed ‘Galleon’.
Rajaratnam has been featured among the elite US money managers in a book called The New Investment Superstars: 13 Great Investors and their Strategies for Superior Returns by Lois Peltz. Initially invested in technology stocks and healthcare companies, he says his best ideas come from frequent visits with companies and conversations with executives who invest in his fund. His hedge fund is currently valued at $3.7 billion, down from its peak of $7 billion in 2008.
Raj Rajaratnam was a major donor to the Obama for President campaign.
Arrest for insider trading
On Friday October 16th, 2009, Raj Rajaratnam was arrested by the FBI and accused of conspiring with others to trade based on insider information about several publicly traded companies, including Google Inc. U.S. Attorney Preet Bharara, putting total profits in the scheme at $20.6 million, told a news conference it was the largest hedge fund case ever in insider information and then caused the Galleon Technology Funds to execute trades that earned a profit of more than $12.7 million between January 2006 and July 2007.
Rajaratnam allegedly profited from information they got from Robert Moffat, an IBM senior vice president who allegedly provided data about a possible IBM merger with Sun Microsystems that led to a $1 million windfall for Rajaratnam's New Castle funds. Rajaratnam has also been accused of conspiring with Intel Capital treasury department managing director Rajiv Goel, and Anil Kumar, a director of McKinsey & Co. The alleged offenses took place over three years starting in January 2006.
The Sri Lankan stock market has fallen sharply after his arrest on insider trading charges. The Colombo Stock Exchange fell 3.9% before recovering to close down 1.6% on Monday, the biggest fall since 4 June.
"He was one of the biggest foreign equity investors in Sri Lanka, both in his personal capacity and through Galleon Group."
US prosecutors claim that Mr Rajaratnam and five other investors secured inside information regarding firms including Google, AMD, and Hilton Hotels.
The others charged in the case include Rajiv Goel, a director of strategic investments at Intel Capital; and Robert Moffat, senior vice president in the systems and technology division of computer group IBM.
See also
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References
- "#236 Raj Rajaratnam". Forbes. Retrieved 2009-02-19.
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Michael J. De La Merced; Zachery Kouwe (October 18, 2009). . Retrieved October 19, 2009.
{{cite news}}: Check|url=value (help) - "#236 Raj Rajaratnam - The Forbes 400 Richest Americans 2009". Forbes. Retrieved 2009-02-19.
- "#262 Raj Rajaratnam". Forbes. Retrieved 2009-02-19.
- ^ Burton, Katherine (2009-10-19). "Raj Rajaratnam Became Billionaire Demanding Edge". Bloomberg.com. Retrieved 2009-10-19.
{{cite news}}: Unknown parameter|coauthors=ignored (|author=suggested) (help) - http://blogs.wsj.com/dispatch/2009/10/16/sec-charges-billionaire-hedge-fund-manager-with-insider-trading