New York (HedgeCo.net) – After 11 days of deliberations, a federal jury in New York’s Southern District has found Galleon hedge fund manager Raj Rajaratnam guilty on all 14 counts of securities fraud and conspiracy — a clean sweep for prosecutors who already collected nearly two dozen settlement pleas with related defendants.

Former federal prosecutor and Congressman Artur Davis, now a partner in the white collar and government investigations practice at SNR Denton, has followed the trial closely and offers a few quick takes on the outcome:

“The verdict proves the power of wiretap evidence and guarantees that the government will be more aggressive about such tactics and may consider other techniques like undercover operatives and sting operations,” said Davis.

“The legal theory in this case was an entirely conventional one and probably tells us little about the state of insider trading law; the more significant cases legally may be the expert network cases where the government cannot consistently prove that trades happened and where the government is seeking to criminalize the divulgence of insider information even in the absence of trading,” he concluded.

Davis served four terms as a member of Congress, representing the 7th District of Alabama. During his time on the Judiciary Committee, he played a key role questioning witnesses during several high-profile investigations, including the committee’s inquiry into the sudden termination of a group of U.S. Attorneys by the Bush Administration.

Alex Akesson
Editor for HedgeCo.net
alex@hedgeco.net
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