Skip to main content

Raj Rajaratnam Never Paid Anyone For The Inside Info He Did Not Trade On

  • Author:
  • Updated:

Raj Rajaratnam has maintained his innocence since he was escorted out of his Sutton Place apartment almost two months ago and apparently that's the story he's sticking with. His lawyers rejected federal insider trading charges this morning, for several reasons. These are our favorite:
1) The government shouldn't have been allowed to wiretap him in the first place, because when it sought approval to do so, failed to mention it had already interviewed him under oath for another investigation, seen Galleon documents, etc. So whatever they may have overheard as a result of the taps-- be it, "I can't believe we're getting away with this shit!" or otherwise-- should not be held against Raj-Raj or Galleon.*
2) Let's just say Raj received inside information (WHICH HE DIDN'T)-- no one was ever paid or otherwise compensated for their hot tips.
3) Galleon wouldn't have needed to gather and trade on inside information because the research done by its analysts was "more detailed and precise" than anything they could've gotten illegally. Unless the alleged inside information had the same in-depth research behind it as Galleon's, i.e. a young analyst modeled Lululemon spandex on a conference room table, Raj would've had no use for it.
Here's the full response, via DealBook:
*I have to say the government really fucked up on this one. Not because they shouldn't have wiretapped Raj-- that's fine but because they failed Snooping 101. This is like when you think someone's up to something, and you go and read their emails to check it out. When you find out you were right, you hold onto that info and then wait for them to fuck up and reveal it to you themselves. You can't admit you know what you know because you used less than legitimate tactics to catch them, i.e. you were reading their shit. This is basically the same thing. God.

Raj Rajaratnam's Court Response to S.E.C. Lawsuit