Galleon hedge fund founder Raj Rajaratnam and co-defendant Danielle Chiesi pleaded innocent on Monday to charges of securities fraud in what U.S. prosecutors describe as the biggest hedge fund insider trading case ever.
Sri Lankan-born Rajaratnam, 52, is the most prominent defendant among 21 people criminally or civilly charged in an insider trading case involving employees of some of America's best-known companies, including IBM Corp., McKinsey & Co. and Intel Capital, an arm of Intel Corp.
Rajaratnam and Chiesi, a former employee of New Castle Funds LLC, pleaded "not guilty" to charges of securities fraud and conspiracy to commit securities fraud at a hearing before Judge Richard Holwell on Monday at U.S. District Court in Manhattan.
Rajaratnam and Chiesi, 44, are the only defendants to be formally indicted so far. Both have been out on bail since their October 16 arrest.
No changes were made to Rajaratnam's bail status at the hearing, but the court set a bail hearing for him on Jan. 8.
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