Prosecutor: More Indictments Possible In Galleon Case

May 25 2011 | 1:55am ET

Federal prosecutors this week said that a former hedge fund manager was still cooperating in the Galleon Group insider-trading probe and indicated that further indictments in the case are possible.

Assistant U.S. Attorney Jonathan Streeter, who led the successful prosecution of Galleon founder Raj Rajaratnam, asked that Steven Fortuna's sentencing on insider-trading charges again be postponed. "There are other individuals he provided information about that we're still in the process of reviewing," Streeter told U.S. District Judge Sidney Stein.

"His cooperation is ongoing," Streeter added. "We need to make the determination about other individuals who've not been charged."

To date, 27 people are known to have been charged in the Galleon case. Of those, 22 have pleaded guilty, including Fortuna. Rajaratnam was convicted earlier this month, while three other men are currently on trial. One of the indicted is a fugitive, believed to be in India.

Streeter, who previously told Stein that the S2 Capital Management founder's testimony might be used in the Rajaratnam case, explained that Fortuna did not testify because his "cooperation was relevant to one of the defendants who has plead guilty," former Rajaratnam co-defendant Danielle Chiesi.

Chiesi was accused of passing confidential information to both Rajaratnam and Fortuna.

Fortuna's new lawyer said his client consented to the sentencing delay. Fortuna pleaded guilty in October 2009.


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