The former head of Galleon Group is set to go on trial today in Manhattan's Federal Court to answer to charges of insider trading. Rajaratnam is accused of acting on confidential information concerning Warren Buffet's plans to invest billions in Goldman Sachs in 2008. Buffet was getting great value for his investment, as the stock price at the time was $115, which was less than half of the price just one year earlier. Rajaratnam sought to take advantage of this insider information and purchase share of Goldman Sachs before Buffet's mulit-billion transaction which would create a surge in demand and lead to higher stock price. As predicted, after Warren Buffet's investment the market responded with buying frenzy and the Goldman shares increased to as much as $135 a share in after-hours trading. Needless to say, the Galleon Group's mission for windfall-like profit was accomplished. Was it really worth it Rajaratnam? Click chart below to see the complex web of insider trading that amounted to millions of illegal profits.
The use of surveillance and wire-tapping helped to being down the greedy trading ring, who all used pre-paid phones to avoid detection.
Back to Homepage
K. Reilly
The Cohn-Reilly Report.com
No comments:
Post a Comment