Galleon founder Raj Rajaratnam pleads not guilty in $30m securities fraud case
• Hedge fund manager Raj Rajaratnam and co-defendant Danielle Chiesi deny charges in New York court
• Pair are first to be indicted in what US prosecutors allege is the biggest hedge fund insider trading case ever
Agencies
Galleon hedge fund founder Raj Rajaratnam and co-defendant Danielle Chiesi pleaded not guilty to charges of securities fraud in what US prosecutors describe as the biggest hedge fund insider trading case ever.
Sri Lankan-born Rajaratnam, 52, is the most prominent among 21 people charged in an insider trading case involving employees of some of America's best known companies, including IBM, McKinsey and Intel Capital, an arm of Intel Corp.
Galleon hedge fund founder Raj Rajaratnam pleads not guilty to charges of securities fraud in $30m insider trading case. Photograph: Brendan McDermid/Reuters
They are the only defendants to be formally indicted so far. Both have been out on bail since their arrest on 16 October. A bail hearing is scheduled for 8 January.
Most of the accused had expertise in technology stocks and the allegations included passing inside information on earnings announcements, takeovers and contracts on 10 companies, generating more than $30m (£18.7m) in illegal profits. Prosecutors alleged Rajaratnam and Chiesi made $20.8m in illegal profits.
Four others who were arrested and charged on the same day have not been indicted; their lawyers are in talks with prosecutors on disposition of their cases.
They are Rajiv Goel of Intel Capital; Anil Kumar, of the management consulting firm McKinsey; Mark Kurland of NewCastle hedge fund; and Robert Moffat of IBM.
Six others have pleaded guilty to criminal charges in the investigation, which also ensnared employees of IBM, McKinsey, Intel Capital, Moody's and the Ropes & Gray law firm.
The insider trading is alleged to have affected Google, Sun MicroSystems, Polycom, Hilton Hotels, Intel and IBM, among others.
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