Hedge fund founder convicted in inside-trade case

Raj Rajaratnam

May 11, 2011 8:20:53 AM PDT
A former billionaire Wall Street hedge fund manager has been convicted of 14 federal charges alleging he made a fortune off insider trades.

A Manhattan jury reached its verdict Wednesday. It had been deliberating since April 25.

Federal authorities had called the insider trading case against Raj Rajaratnam the biggest ever involving a hedge fund.

The case centered on the testimony of cooperators and secretly recorded phone calls. Rajaratnam could be heard on calls talking to what prosecutors called his "corporate spies" about earnings and mergers.

The 53-year-old defendant was accused of using the inside tips to gain an edge on trades that made his Galleon Group funds more than $60 million in profits and avoided losses.

The defense said Rajaratnam only relied on legitimate research and analysis.