Wednesday, 25 May 2016
Last updated 19 min ago
Feb 25 2011 | 9:52am ET
An unidentified former employee of the Galleon Group will testify against the hedge fund's founder, Raj Rajaratnam, at his insider-trading trial, which begins next month.
The former employee, who approached the Securities and Exchange Commission in November, is nearing a deal with prosecutors to take the stand. He would testify that Rajaratnam traded on confidential information, and has also agreed to testify to statements made by Rajaratnam's younger brother, Ragakanthan, himself a former Galleon portfolio manager, the New York Post reports.
The statements from the younger Rajaratnam, who has not been charged with any wrongdoing but who has been identified as a co-conspirator in the case against another former Galleon trader, Michael Cardillo, apparently deal with what his brother knew about the companies he allegedly made illegal trades in.
The unidentified cooperator, apparently the first Galleon employee to voluntarily approach authorities without the threat of charges hanging over him, is behind a whistleblower complaint filed against Galleon. Any deal would reportedly have to include immunity from prosecution.
Rajaratnam's trial is set to begin on March 8. Nineteen people, including Rajaratnam's former co-defendant, Danielle Chiesi, have already pleaded guilty in the case.