NY JUDGE UPHOLDS CHARGES AGAINST RAJARATNAM'S BROTHER
Rengan Rajaratnam, the younger brother of imprisoned hedge fund manager Raj Rajaratnam, on Friday lost a bid to dismiss some of the insider trading charges leveled against him last year.
U.S. District Judge Naomi Reice Buchwald in Manhattan ruled that the indictment adequately alleged the essential elements of the crimes charged.
Buchwald agreed that four securities fraud counts were "internally inconsistent" with a conspiracy charge contained in the indictment. But she withheld ruling on
Prosecutors alleged that Rengan Rajaratnam (43) had conspired with his brother to trade on non-public information related to technology companies and netting $1.2 million in illegal profits
whether to dismiss them in order to allow the government to decide whether to proceed on those charges.
A lawyer for Rajaratnam did not respond to a request for comment. A spokeswoman for Manhattan U.S. Attorney Preet Bharara declined to comment. The case, set for a June 17 trial, is one of a wave of insider trading prosecutions pursued by Bharara's office, resulting in 80 convictions since October 2009.
Raj Rajaratnam, founder of the hedge fund Galleon Group, received an 11-year prison sentence in October 2011 after a jury convicted him on charges related to insider trading.
A grand jury subsequently indicted Rengan Rajaratnam, a former portfolio man- ager at Galleon, in March 2013 on one conspiracy count and six counts of securities fraud.
Prosecutors alleged that Rengan Rajaratnam (43) had conspired with his brother to trade on non-public information related to technology companies and Clearwire Corp and Advanced Micro Devices Inc (AMD.N), netting $1.2 million in illegal profits.
Rajaratnam's lawyers had argued the indictment failed to charge that he knew two alleged tippers of non-public information received personal benefits in exchange for giving tips to Raj Rajaratnam.
The tippers, prosecutors said, were Rajiv Goel, an employee of Intel Corp (INTC.O), and Anil Kumar, a former McKinsey director. Both admitted to providing tips to Rajaratnam and received probation in 2012 after pleading guilty and cooperating with the investigation.
In her ruling Friday, Buchwald said while the indictment did not explicitly state the tippers received benefits, it provided enough details to give Rajaratnam notice of the charges against him.