NEW YORK (AP) — A hedge fund founder serving the longest prison term ever given for insider trading also will be writing the government another big check.
Raj Rajaratnam, a one-time billionaire convicted last year of trading on inside information, will pay nearly $1.45 million to settle a civil case brought by the Securities and Exchange Commission, court documents show. A federal judge on Thursday approved the deal, which requires Rajaratnam to pay the settlement within 90 days and waive any right to appeal it.
The documents say the settlement includes $1.29 million representing "profits gained and losses avoided" as a result of trading on tips from a former Goldman Sachs Group Inc. director convicted separately in June. The settlement also includes $148,000 in prejudgment interest.
The Sri Lanka-born Rajaratnam, who founded the New York-based Galleon Group of hedge funds, previously was ordered to pay a record $92.8 million civil penalty to the SEC.
In the criminal case against him, he was fined $10 million and was ordered to forfeit $53.8 million in what U.S. District Court Judge Jed Rakoff said last year were illicit profits from trading on confidential corporate information.
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