![US hedge fund founder denies insider trading allegations](https://www.jurist.org/wp-content/uploads/2021/12/jurist-white-text.png)
[JURIST] Galleon Group [partnership website] hedge fund founder Raj Rajaratnam [Financial Times profile] denied any wrongdoing Sunday, promising to fight charges brought against him in one of the US government's largest insider trading cases to date. Rajaratnam was arrested Friday and charged [complaint, PDF; press release] along with five other individuals and two business entities with insider trading. The complaint alleges that the individuals, including a managing director at Intel Corp., a director at McKinsey & Co., and a senior executive at IBM [corporate websites] who were charged with Rajaratnam, provided Galleon Group and another hedge fund with material nonpublic information about several corporations upon which the funds traded, generating $25 million in illicit gain. Also on Sunday, the government of Sri Lanka accused Rajaratnam of helping fund [Financial Times report] the Tigers of Tamil Eelam (LTTE) [JURIST news archive], a group designated as a terrorist organizations by several countries including the US. Although records show that Rajaratnam contributed money to the Tamil Rehabilitation Organization, a charity that the US claimed was a front for the LTTE, Rajaratnam denies funding the LTTE and has not been charged with funding the LTTE.
In July, the US Securities and Exchange Commission (SEC) [official website] promised to increase oversight [JURIST report] and enforcement of securities laws to better protect investors. The policy reforms come in the wake of recent fraud litigation. In June, financier Bernard Madoff [JURIST news archive] was sentenced to 150 years in prison [JURIST report] on securities fraud charges [complaint, PDF; JURIST report] stemming from his multi-billion dollar Ponzi scheme. Billionaire financier Allen Stanford [BBC report] pleaded not guilty [JURIST report] in June to 21 charges [indictment, PDF; JURIST report] of fraud, conspiracy and obstruction related to a $7 billion fraud scheme. Former HealthSouth CEO Richard Scrushy [defense website; JURIST news archive] was ordered [JURIST report] to pay $2.88 billion to shareholders after being found guilty of fraud for inflating company profits, insider trading and other charges.