Small Problem For Convicted Billionaire: $92.8 Million Penalty

The big news about hedge fund billionaire Raj Rajaratnam recently has been his conviction for insider trading  and the record prison term to which he was sentenced. 

There’s a footnote now to add to that: the SEC has just obtained a record financial penalty of more than $92.8 million against Rajaratnam - the largest penalty ever assessed against an individual in an SEC insider trading case.
 
The SEC brought civil charges against Rajaratnam (pictured) on October 16, 2009, alleging that he and several others including his New York-based hedge fund advisory firm Galleon Management LP engaged in a massive insider trading scheme. The SEC subsequently amended its complaint in November 2009 and January 2010, adding several more defendants and alleging additional insider trading schemes that cumulatively generated more than $52 million in illicit gains.
 
“The penalty imposed today reflects the historic proportions of Raj Rajaratnam’s illegal conduct and its impact on the integrity of our markets,” said Robert Khuzami, Director of the SEC’s Division of Enforcement.
 
At the least, the SEC can laud it over the U.S. Attorney’s Office for the Southern District of New York: As part of his criminal sentencing, Rajaratnam was ordered to pay $53.8 million in forfeiture of illicit gains and $10 million in criminal fines – less than the judgment the SEC obtained.