Tags: SEC | Rajaratnam | Gupta | question

SEC Seeks to Question Rajaratnam Brothers in Gupta Case

Tuesday, 08 Nov 2011 01:28 PM

The U.S. Securities and Exchange Commission wants to question “one or both” brothers of Raj Rajaratnam for its lawsuit against Rajat Gupta, the former Goldman Sachs Group Inc. director, an agency lawyer said.

The SEC sued Gupta on Oct. 26, accusing him of feeding tips to Rajaratnam, the Galleon Group LLC co-founder convicted of being at the center of the largest hedge fund insider-trading case in U.S. history.

That same day, Manhattan U.S. Attorney Preet Bharara charged Gupta with five counts of securities fraud and one count of conspiracy to commit securities fraud. Rajaratnam, who is a co-defendant in the SEC’s case against Gupta, was separately sued by the agency in 2009 when he was first charged criminally.

“We have a long list of witnesses including the defendant and one or both of Mr. Rajaratnam’s brothers,” Kevin McGrath, a lawyer for the U.S. Securities and Exchange Commission, told U.S. District Judge Jed Rakoff today at a hearing.

Rajaratnam’s brother, Rengan, who operated his own fund, Sedna Capital Management LLC, was heard talking to his brother Raj Rajaratnam on wiretaps that were recorded by the Federal Bureau of Investigation and played at the Galleon Group co- founder’s trial. Prosecutors also identified Rengan Rajaratnam as an unindicted “co-conspirator” with Raj Rajaratnam.

Rajaratnam’s other brother has been identified in published reports as Ragakanthan Rajaratnam. Neither of the convicted fund manager’s brothers has been charged with criminal wrongdoing.

The cases are U.S. v. Gupta, 11-cr-00907, and SEC v. Gupta, 11-cv-07566, U.S. District Court, Southern District of New York (Manhattan).

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