New York, REUTERS - Raj Rajaratnam wanted to “conquer the stock market at the expense of the law,” a U.S. prosecutor said in closing arguments of the hedge fund manager's insider trading trial on Wednesday.
But a lawyer for the Galleon Group founder countered in his summation that “the government's narrow view is very unfair” and Rajaratnam acted legally in seeking out information about investments on behalf of his customers.
As the six-week trial wound toward a conclusion, the voice of Rajaratnam rumbled repeatedly over speakers in a New York courtroom as prosecutor Reed Brodsky replayed excerpts of FBI phone taps to remind the jury that the defendant timed his stock trades, sometimes seconds after learning corporate secrets.
“You heard the defendant committing his crimes time and time again in his own words,” Brodsky told the jury in 4-1/2 hours of summing up the government's evidence that Rajaratnam made an illicit $63.8 million between 2003 and March 2009.
He said the case, built in part on trial testimony from three cooperating witnesses, demonstrated “overwhelming” and “devastating” evidence of Rajaratnam's guilt in the government's biggest probe of insider trading at hedge funds.
In contrast, chief defense lawyer John Dowd said the testimony from these witnesses was “unreliable and worthless.” Dowd also said the government failed to make its case. “The government's case rests on the fictional idea that company information cannot become public until a company issues a press release,” Dowd said.
He also told the jury, “In the real world information can become public in all kinds of ways. If it's public, you must acquit.” Rajaratnam, a 53-year-old one-time billionaire, is the central figure in the sweeping U.S. government probe of insider trading at hedge funds, and the only defendant so far to go on trial. If convicted, he could face up to 25 years in prison.
To convict, the government must convince jurors beyond a reasonable doubt that Rajaratnam received material nonpublic information from people who had a duty not to disclose it, and that he knew it was wrong to trade on it.
During Brodsky's animated presentation, he sometimes raised his voice to emphasize a point from a lectern directly in front of the jury box. Dowd used a more matter-of-fact tone, mostly reading from the lectern.
Both men referred to documents in evidence that were projected onto screens in the courtroom.
Dowd spoke for about one hour, and was expected to continue his closing statement on Thursday.