Galleon Group

The Galleon Group
Industry Investment management
Founded 1997
Founder Raj Rajaratnam
Ari Arjavalingam
Gary Rosenbach
Krishen Sud
Defunct October 21, 2009 (2009-10-21)
Headquarters New York City, U.S.
Key people
 Raj Rajaratnam (investing)
Gary Rosenbach (trading)
Products Hedge fund
AUM over $ 7 billion (peak)
Website www.galleongrp.com

The Galleon Group was one of the largest hedge fund management firms in the world, managing over $7 billion, before closing in October 2009.[1] The firm was the center of a 2009 insider trading scandal.[2]

The firm was founded by Raj Rajaratnam, a former equity research analyst and eventual president of Needham & Company, in 1997.[3][4] The New York headquartered firm was named for the galleon, a large sailing ship used from the 16th to 18th centuries in Europe.

Insider trading investigation

In October 2009 Rajaratnam and five others were arrested and charged with multiple counts of fraud and insider trading. Rajaratnam pleaded not guilty and remained free on $100 million bail, the largest in United States history. He was indicted by a grand jury in December 2009[5] and found guilty in U.S. District Court on 14 charges in May 2011.[6][7] He was sentenced by U.S. District Judge Richard Holwell to 11 years in prison on October 13, 2011.[8]

Other former and current traders at Galleon were subsequently arrested and charged with contributing to the alleged conspiracy. Several former employees of the firm have cooperated in the investigation.[9] As of January 2012 over fifty people have been convicted or pleaded guilty to date in the sprawling probe stemming from Galleon (not all of them Galleon employees).[10]

Zvi Goffer, an ex-Galleon Group LLC trader, was found guilty of all 14 counts of conspiracy and securities fraud against him and sentenced by Judge Sullivan "to 10 years in prison for his role in a scheme to trade on inside information provided by lawyers". Goffer had asked for a lenient sentence and prosecutors had recommended more than 10 years.

Adam Smith, an ex-Galleon Group LLC trader, pleaded guilty and cooperated in the criminal trial of Raj Rajaratnam. He was sentenced in June 2012 to only a period of probation and no jail time by Judge Jed Rakoff, who took over the case from Judge Richard Holwell when the latter retired from the bench.[11][12]

See also

References

  1. ↑ Galleon to Wind Down Hedge Funds. Wall Street Journal, October 21, 2009
  2. ↑ Galleon Clients Abandon Ship. Wall Street Journal, October 21, 2009
  3. ↑ "General Information". Teksia. Retrieved 2009-02-19.
  4. ↑ "Who is the Galleon Group?". SiliconIran. Retrieved 2009-02-19.
  5. ↑ http://www.nytimes.com/2009/12/16/business/16insider.html/ New York Times, December 15, 2009
  6. ↑ http://www.cnbc.com/id/42989354/ CNBC.com, May 11, 2011
  7. ↑ Lattman, Peter; Ahmed, Azam (May 11, 2011). "Galleon's Rajaratnam Found Guilty". The New York Times.
  8. ↑ Van Voris, Bob, and Patricia Hurtado, "Ex-Galleon Trader Zvi Goffer Sentenced to 10 Years in Prison", Bloomberg via San Francisco Chronicle, September 21, 2011. Retrieved 2011-09-21.
  9. ↑ Zachery Kouwe (June 2, 2010). "Former Galleon Trader Franz Tudor Key to Galleon Case". Dealbreaker.
  10. ↑ "Boston fund trader arrested in insider trading sweep". The Boston Globe.
  11. ↑ Glovin, David (March 4, 2011). "Galleon Trial Scorecard: Rajaratnam, Friends, Colleagues and Cooperators". Bloomberg.
  12. ↑ Pavlo, Walter (June 26, 2012). "Former Galleon Trader and Govt Informant, Adam Smith, Sentenced to Probation". Forbes.

Interactive and visual Relationship Map showing Galleon Group's ownerships and Raj Rajaratnam's relationships

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