Rajaratnam to pay USD 1.45mn to settle SEC suit on Gupta tips

NEW YORK, Dec 28: Jailed hedge-fund founder Raj Rajaratnam has agreed to pay USD 1.45 million to settle a civil lawsuit filed by US regulator SEC against him and India- born former Goldman Sachs director Rajat Gupta for their roles in one of the largest insider-trading schemes in US history.
55-year-old Rajaratnam, Galleon Group’s Sri Lanka-born co-founder, has also agreed to waive his right to appeal this judgement, court papers showed.
US District Judge Jed Rakoff yesterday approved the final judgement in the Securities and Exchange Commission’s (SEC’s) case against Rajaratnam, who is serving 11 years in prison for insider trading, and 64-year-old Gupta.
Under the consent agreement signed by Rajaratnam earlier this month, he would pay a total of USD 1.45 million, which includes USD 1.3 million in disgorgement and about 147,000 dollars in prejudgment interest.
Rajaratnam has been ordered to pay the amount within 90 days.
The final judgement in the SEC’s case orders Rajaratnam to disgorge his share of the profits gained and losses avoided as a result of the insider trading as well as the prejudgment interest on that amount.
The SEC’s claims against Gupta remain pending.
The US regulator had filed its complaint in October 2011, alleging that Gupta had passed on to Rajaratnam confidential information he had learned as Goldman board member about Berkshire Hathaway’s USD five billion investment in the financial giant in September 2008, as well as about Goldman’s financial results for the second and fourth quarter of 2008.
Rajaratnam used the information he learned from Gupta to trade profitably in certain Galleon hedge funds. (PTI)

LEAVE A REPLY

Please enter your comment!
Please enter your name here