Galleon lawyer says tips were smart, not illegal | business | Hindustan Times
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Galleon lawyer says tips were smart, not illegal

business Updated: Apr 12, 2011 23:17 IST
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Raj Rajaratnam, the key accused in the biggest insider trading case in US history, worked hard to learn how the markets was operating and didn’t need illegal tips to make money, a former executive of the hedge fund has testified.

Rick Schutte, a former analyst at Galleon Group, told the jury on Monday during the first day of Rajaratnam’s defence that the hedge fund, with its technological advantage and its “disciplined” approach, didn’t need illegal tips to make money.

“No,” said Schutte when asked by Rajaratnam’s lawyer whether the defendant asked for insider information.

The defence also called John C Pernell, the president of Polaris Investment Partners Inc, to discredit previous testimony of Adam Smith, a former employee at Galleon, who said that he dug up secrets to give his boss “an edge”.

Last week, the prosecution rested its case biggest hedge fund insider trading cases to his US courts in decades.

The government had played secretly recorded phone conversations between Rajaratnam and his sources who allegedly provided him with confidential information.

The defence will try to establish that Rajaratnam’s trade was based on research, knowledge of the market, and information already available in the public domain.