How’s Eddie the Samoan manservant supposed to live if Raj has to pay the SEC $90 million?

Raj Rajaratnam is having the time of his life in prison and isn’t eager to leave his deluxe accommodations at Federal Medican Center Deven’s P3 unit, which is good, because the courts have said that the Galleon Group founder and convicted insider-trader isn’t going anywhere until the summer of 2021 at the earliest. Here’s the thing, though: Keeping up appearances on the inside—manservants, freshly-microwaved meals, etc.—is expensive, as are lawsuits from family members and the like. So while he’s happy to serve every one of the 11 years in prison he’s been sentenced to, isn’t a bit much to also ask him to pay nine figures in fines, forfeitures and civil penalties? He could really use that money on the inside (and also a Michael Cohen type to distribute it, since his former driver was very much not up to the job). After all, as he’s argued unsuccessfully before, prosecutors, judges and the SEC are super bad at calculating just how much money he made trading on inside dope, which amount is way lower than they say it is. Unfortunately for Raj, three appellate judges in Manhattan are also lawyers and not mathematicians, so that $92.8 million bill stands.

The 2nd U.S. Circuit Court of Appeals in Manhattan on Tuesday rejected Rajaratnam’s arguments that the SEC penalty was excessive, improperly took his wealth into account and had no deterrent value....

In Tuesday’s 3-0 decision, the appeals court said U.S. District Judge Jed Rakoff did not abuse his discretion in imposing the $92.8 million penalty.

Rajaratnam had argued that federal law capped the penalty at three times the $4.7 million in fees, bonuses and returns he personally stood to gain through his investments in Galleon.

Rajaratnam’s $92.8 million SEC civil fine is upheld [Reuters]

Related

Raj Rajaratnam Basically Has Washboard Abs Now, Says Completely Objective Third Party

Back in December, things were not going so well for hedge fund manager Raj Rajaratnam. For starters, he had just reported to prison to serve an eleven year sentence for insider trading, where there would be no April Fool's day midgets or employees to tase or extra mayo to eat. Then there was the matter of the "unique constellation of ailments ravaging his body," and the kidney transplant he was said to need. Finally, and not that there's anything wrong with this, but if you're a person who thinks looks matter, he was fat. It would have been enough to send Raj into an understandable a tailspin of sorrow and despair. And yet? It turns out the Galleon founder is not only doing great but looks good too. How good? While we have no photographic evidence, consider that an attorney who does not represent the guy and was ostensibly speaking to Bloomberg about a story involving Raj declining to answer questions about a tax shelter case could not help but steer the conversation to Big R's new body. Rajaratnam, convicted last year of directing the largest hedge fund insider-trading scheme in U.S. history, was interviewed yesterday for about an hour and 45 minutes at the Federal Medical Center Devens in Ayers, Massachusetts. The deposition stems from a case involving a tax shelter Rajaratnam had invested in. He isn’t a defendant in the lawsuit. He refused to answer any of the more than 100 questions he was asked, invoking his right against self-incrimination under the U.S. Constitution’s Fifth Amendment, said Howard Kleinhendler, an attorney representing the plaintiffs. “He looked good,” Kleinhendler, of Wachtel Masyr & Missry LLP in New York, said today in a phone interview, adding that Rajaratnam appeared to have lost weight since the last time he saw him, in 2007. Rajaratnam, 55, has said in court papers that he has health problems including diabetes and will probably need dialysis and a kidney transplant. “He was in good spirits,” Kleinhendler said. You'd be in a good mood too if you could finally see your feet again. Guy could be in a Thai prison right now and he'd be happy as a clam. Rajaratnam Silent In Tax-Shelter Deposition, Lawyer Says [Bloomberg]