|Defunct||October 21, 2009|
|Headquarters||New York City, U.S.|
|Key people||Raj Rajaratnam (investing)
Gary Rosenbach (trading)
|AUM||over $ 7 billion (peak)|
The Galleon Group was one of the largest hedge fund management firms in the world, managing over $7 billion, before closing in October 2009. The firm was the center of a 2009 insider trading scandal.
The firm was founded by Raj Rajaratnam, a former equity research analyst and eventual president of Needham & Company, in 1997. The firm was named for the galleon, a large sailing ship used from the 16th to 18th centuries in Europe, and headquartered in New York City.
In October 2009 Rajaratnam and five others were arrested and charged with multiple counts of fraud and insider trading. Rajaratnam pleaded not guilty and remained free on $100 million bail, the largest in United States history. He was indicted by a grand jury in December 2009 and found guilty in U.S. District Court on 14 charges in May 2011. He was sentenced by U.S. District Judge Richard Holwell to 11 years in prison on October 13th, 2011.
Other former and current traders at Galleon were subsequently arrested and charged with contributing to the alleged conspiracy. Several former employees of the firm have cooperated in the investigation. As of January 2012 over fifty people have been convicted or pleaded guilty to date in the sprawling probe stemming from Galleon (not all of them Galleon employees).
Zvi Goffer, an ex-Galleon Group LLC trader, was found guilty of all 14 counts of conspiracy and securities fraud against him and sentenced by Judge Sullivan "to 10 years in prison for his role in a scheme to trade on inside information provided by lawyers". Goffer had asked for a lenient sentence and prosecutors had recommended more than 10 years.
Adam Smith, an ex-Galleon Group LLC trader, pleaded guilty and cooperated in the criminal trial of Raj Rajaratnam. He was sentenced in June 2012 to only a period of probation and no jail time by Judge Jed Rakoff, who took over the case from Judge Richard Holwell when the latter retired from the bench.
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