Convicted hedge fund tycoon Raj Rajaratnam has already paid more than $63 million in penalties, ordered by the judge who sentenced him two weeks ago for insider trading, one of his lawyers said on Friday in New York federal court. Rajaratnam, 54, is going to prison for 11 years - the longest sentence recorded for an insider-trading case - as the central figure in a broad government crackdown using FBI phone taps.
He was convicted by a jury in May. The lawyer, William White, was arguing before a different Manhattan federal court judge on Friday over what civil penalties the Galleon Group founder should now pay to the US Securities and Exchange Commission (SEC), the government's market regulator.
Without disclosing Rajaratnam's net worth, White said that since the October 13 criminal sentencing proceeding, his client had forfeited more than $53 million to the government and paid a $10 million fine in addition. The SEC is now seeking an additional $96.4 million in civil penalties, an SEC lawyer told US District Judge Jed Rakoff on Friday.
Rakoff said he would consider Rajaratnam's ability to pay in making his decision about the dollar amount of civil penalties. "I'm not a big fan of symbolic gestures," he said. "I'd like there to be a reasonable possibility that it gets paid." Rajaratnam is a multimillionaire whose Galleon hedge fund managed $7 billion at its peak.