The case of Raj Rajaratnam vs the world continues with news that a Bear Stearns fund manager allegedly had an “intimate relationship” with then AMD CEO 2002-2008 Hector Ruiz.
Meanwhile, the defence team for the Galleon Group founder has said that the Sri Lankan-born billionaire didn’t spill any beans about AMD and therefore didn’t make any profits on insider information.
They claim instead that Rajaratnam’s tips about the ATI-AMD deal were already in the media, so already in the public domain and not insider tips.
Rajartnam’s lawyer’s claims follow a case against the alleged inside-trader, which is part of a major US crackdown on hedge fund insider trading. Prosecutors claim that he was at the centre of a scheme which generated $45 million using leaked information taken from a network of traders.
It is thought the alleged scam affected up to three dozen firms including IBM and Morgan Stanley as well as AMD.
However, today AMD was in the spotlight when Rajaratnam’s lawyer 69-year-old John Dowd showed Anil Kumar, a key government witness, evidence of a series of news articles, which he claimed showed was already available in the media.
But Kumar, who claims that Rajaratnam was paying him $500,000 a year for his “insight”, said that the press reports were “speculative.” He stuck the wooden spoon in further claiming he had given “more accurate facts than a journalist would”.
Of course he has nothing to lose given that he’s already pleaded guilty to providing insider tips to Rajaratnam between 2003 and 2009. He claims that he received more than $2 million for the snitching.
He’s also trying to tell the courts that he’s the source behind the 2005-2006 AMD leaks.
After the deal went through, Kumar said Rajaratnam told him, “You’re a star … you’re a hero.,” and later paid him $1 million.
Rajaratnam, who is charged with 14 counts of security fraud and conspiracy, could face up to 20 years in prison if convicted.