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Raj Rajaratnam Was Done In By Multiple Moles

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Less than two weeks ago, Raj Rajaratnam was sentenced to 11 years in prison, after being convicted on 14 counts of securities fraud and conspiracy last May. Over the course of the trial, Raj had remained silent, choosing not to take the stand on his own behalf and offering no sound bites to reporters outside the courthouse, speaking only when it was absolutely necessary (to request "extra mayo") and allowing his lawyer, John Dowd, to do the talking (asking a Wall Street Journal reporter how long one could reasonably expect him to continue "sucking on [U.S. Attorney for the Southern District of New York Preet] Bahara's teat," declaring the guilty verdict a "23-14 victory" for the defense, and telling CNBC to "get the fuck out of here"). Recently, however, the former hedge fund manager decided to open up, allowing a reporter into his home where he pulled the curtain back on how this whole thing went down, starting with the state in which the Feds found him that fateful morning.

It was 6 a.m. on Oct. 16, 2009, and Raj Rajaratnam, head of the Galleon Group hedge fund, was at home on* his exercise bike looking out over Manhattan’s Turtle Bay.

Raj could have mentioned that he next moved on to shirtless arm curls and was on 1,003 at the exact moment Bhara and his crew busted into the apartment but felt like bragging. For posterity's sake, though, it should be noted that he did over 1,000.

Moving on.

What he was actually doing at tipster Rajiv Goel's home all those times, contrary to what the press and the government would have you believe?

...the prosecution noted that Rajaratnam would visit Goel’s house in Silicon Valley, presumably to talk about Intel. But the real explanation is more human. “His wife makes really good chaat [a savory snack]!”

Okay, that's believable, but what about the material non-public information he got elsewhere?

In his conversations with Anil Kumar, Rajaratnam had trusted him to decide what was and was not insider information. “I did not think a senior partner of McKinsey would violate the confidentiality of McKinsey. I assumed he was kosher, that he would not cross the line.” Rajaratnam does not speak well of Kumar. He calls him a choot—Hindi for “c--t.” “I’m not Indian, but that word fits him,” he says.

Most importantly, what possessed him to decline the deal that was offered to him in October 2009, which would have resulted in a maximum of five years in prison and only posed a minor disruption in his Tour de France training?

“Two or three years ago, before all of this stuff happened, my sister Vandani was in Singapore—she’s into all this stuff. She called me one day and said, ‘Raj, I met this person who said you’ll be betrayed by an Indian woman with a mole on her face.’?” He didn’t pay much attention to this prophecy. “Then I got indicted, and I saw a photo of Roomy Khan, with a huge mole on her face. The picture was from a few years ago. She had it surgically removed.” And at the end of the ola-leaf reader’s tape, the astrological conclusion heartened him. “He said that eventually I would prevail.” It fueled his conviction that he should fight the case all the way. It explains his puzzling insistence that he is innocent, in spite of the massive wiretap evidence to the contrary. This was his edge; this was inside information that no one else had.

The Outsider [TDB]

*Please note that it's simply "on" his exercise bike.