NEW YORK, October 16, 2009 (AFP) – US authorities Friday charged a billionaire hedge fund manager and five others with insider trading that netted 20 million dollars on trades in Google, Hilton Hotels Corp. and other companies. The case was helped by a cooperating witness, who indicated that Rajaratnam learned, for example in 2007 that Hilton was going to be taken private, enabling him to buy hundreds of thousands of shares in advance for a profit of four million dollars.
In another case, the group benefitted from inside data on Akamai, an Internet service group, when it was about to lower its guidance for earnings in 2008.
New Castle sold the shares “short” and earned a profit of more than 2.4 million dollars, officials said.
A related civil complaint from the Securities and Exchange Commission seeks the return of 25 million dollars in “ill-gotten gains plus prejudgment interest,” along with other penalties.
According to Forbes, Rajaratnam is a native of Sri Lanka who studied in Britain and the United States before creating the hedge fund, believed to manage some six billion dollars in assets. The Justice Department filed the charges which named Raj Rajaratnam, head of the Galleon Management hedge fund and l