20 January, 2022

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A Review: Uneven Justice: The Plot To Sink Galleon

By Ana Pararajasingham

Ana Pararajasingham

Uneven Justice: The Plot to Sink Galleon by Raj Rajaratnam is a powerful account by a man who was let down by the American Justice System. Convicted of ‘insider trading’, Sri Lankan-born Rajaratnam, the founder of Galleon, the phenomenally successful hedge fund was forced to serve seven and a half years of an eleven-year sentence. He was released in July 2019.

Rajaratnam could have avoided the ordeal had he agreed to become a cooperating witness, helping the government with testimony—regardless of the truth—to convict another defendant. Had he chosen this path he might have at worst received a much-reduced sentence and at best given a suspended sentence and be let out on parole.

Instead, Rajaratnam, not unaware that those charged with ‘insider trading’ had a ninety-seven percent conviction rate   decided to go to trial. It was a decision not taken lightly. In Rajaratnam’s own words: “I went through a period of soul-searching. Why was this happening to me? Ultimately, I realized that I had to fight for my innocence and resolved to fight the battle to the finish”. After all the allegation of ‘insider trading’ was based on just .01 percent of Galleon’s trade between 2005 and 2009. It was a microscopic proportion of Galleon’s trade. Even these were backed by evidence supporting Rajaratnam’s claim that all decisions made by the hedge fund were based on well-researched written reports by its analysts. Not only that the so called ‘insider trading’ that he was charged with had netted the hedge fund not a profit but a loss of “over $30 million”.

Yet, the decision to fight was a courageous one and could not have been an easy one. Again in Rajaratnam’ s own words “I went to trial because I was not prepared to plead guilty for something that I did not do, no matter what the ultimate cost”

Where did Rajaratnam find this courage. Perhaps, it is to be found in stories that he had learnt as a child reflecting the values of his his heritage . As Rajaratnam relates:

Night after night, my mother always told us stories; tales and legends that inspired us to find courage, be brave and stand upright. One of my favorites is called “Veerathai” (“Brave Mother”) in Tamil. The mother in the story learns that her only son has been killed in battle. Refusing to wait until the body is returned to her, she rushes instead to the battle site to confirm just one thing: whether the arrow had penetrated his chest or his back. Finding that the arrow had pierced his heart, the mother is filled with tremendous pride: her son had not run away from battle.

As a young boy, I thought it odd that a mother could possibly be happy about the death of her only son. My mother would lovingly and patiently explain the moral until I finally understood that courage comes in many forms, including standing up and facing adversity with dignity.

Rajaratnam firmly believed in the American Justice system. Unfortunately, it was a system lacking in checks and balances. Consequently, it had allowed unscrupulous-men to advance their own careers at the cost of delivering justice.

Amongst those singled out by Rajaratnam for abusing the U.S justice system is the publicity-hungry and ambitious U.S. Attorney Preet Bharara who had cleverly exploited the ambiguities of the law around ‘insider trading’ to advance his own career. Bharara ran roughshod over the truth, standard DOJ protocols, and the office’s own dignity in his extraordinary zeal and in the process had earned a place in the   cover of the Time Magazine. Rajaratnam exposes Bharara’s hypocrisy by pointing out how Bharara who now works for the private sector makes a living out of questioning the validity of the very same laws upon which he had managed to convict the likes of Rajaratnam and others.

Rajaratnam’s experience with FBI’s Kang was particularly traumatic. Kang having cuffed Rajaratnam in the presence of his children had cruelly told him “Take a good look at your son because you’re not going to see him for twenty years”. Kang did not stop at that. He menaced and threatened Rajaratnam’s family and employees with prosecution, frightened away crucial defence witnesses, and routinely leaked false information to the media, churning up an unabated feeding frenzy that convicted Rajaratnam in the court of public opinion.

Then there was the SEC Commissioner Mary Shapiro who gloatingly stated in May 2011, shortly after Rajaratnam’s trial, that “the beauty of insider trading laws is the flexibility in interpreting them.”

Two chapters of the book are devoted to Anil Kumar, a former colleague and key witness for the prosecution. These chapters clearly show how the entire trial had been based on a web of lies concocted by Anil Kumar.

The book is a painstaking effort by Rajaratnam who wrote the entire book by hand while in prison.

Strangely, the ordeal having pushed Rajaratnam to the very end of despair had helped him gain a sense of peace and awareness once he finally broke through it. It had helped him realize how incredibly strong the human mind is and that nothing can beat a person who refuses to be beaten.

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Latest comments

  • 5
    3

    The article throws doubt into the much publicised verdict against Raj Rajaratnam. Ana Pararajasingham has made Raj Rajaratnam’s version of his own story quite engrossing.

    • 1
      4

      Garbage

      He did what is the definition of insider trading. the fact there may be crooks not yet caught is no excuse.

  • 7
    4

    Raj Rajaratnam is a crook, and is rewriting history.

  • 4
    6

    What he was punished for was something illegal that he did.
    Is the complaint that he could not wriggle out of punishment?
    Getting caught in the act is the biggest offence in any criminal act.
    *
    Are we painting silver linings to a cloud?

    • 3
      3

      may I respetfully suggest that you havea look at this aricle which appeared in Forbes titled:
      “The Tragic and Needless Destruction of Raj Rajaratnam, Price-Giver Extraordinaire”

      https://www.forbes.com/sites/johntamny/2021/12/08/the-tragic-and-needless-destruction-of-raj-rajaratnam-price-giver-extraordinaire/?sh=37d94cd044b8

      Apart from the Raj Rajaratnam case, the US criminal Justice system has been criticised by several institutions and induviduals, many of whom are legal professionals.

      Ana Pararajasingham

      • 0
        0

        AKP,

        That Forbes article was written by a man on the libertarian fringe. There is a school of thought that says insider trading actually helps markets. One business school dean used to have such a view as well.

        But it is not the mainstream view and people cannot blatantly violate the laws that they disagree with.

    • 2
      2

      May I respectfully suggest that you havea look at this atricle which appeared in Forbes titled:

      “The Tragic and Needless Destruction of Raj Rajaratnam, Price-Giver Extraordinaire”

      https://www.forbes.com/sites/johntamny/2021/12/08/the-tragic-and-needless-destruction-of-raj-rajaratnam-price-giver-extraordinaire/?sh=37d94cd044b8

      Apart from the Raj Rajaratnam case, the US criminal Justice system has been criticised by several institutions and induvidual, many of whom are legal professionals.

      Ana Pararajasingham

  • 9
    2

    Rajaratnam was convicted of insider dealing, period. He committed a crime but if he did or didn’t wanted to snitch on another law breaker to save his skin doesn’t vindicate him from his crime. Its time the same judicial process is conducted in SL.

    • 4
      2

      R-UK
      Very true.

  • 4
    6

    lol . I saw the interview. He is just justifying himself after getting caught.

    • 4
      0

      Insider trading is not unusual in any country. But only a few get caught, depending on their associates. In Srlilanka, a lot of high class business men and women do it frequently with impunity. A few may be members in the cabinet and other have kept the ‘skeleton in the cupboard’ secularly locked with the help of the government, irrespective of the party in power. United in hypocrisy.
      As far as Raj is concerned he is supposed to have helped those in need immensely, specially the Tsunami Victims in Srilanka. This is not spoken loud, may be because of his race.

  • 10
    2

    This is nonsensical. People like this mock the system. Look at the Indian Cricket Board( also SL , Pakistan ), is this Cricket ?

    Insider dealing is a cancer even in SL Stock market.

    The fact is Rajaratnam paid money to his informants .

    He still says in his book that he respects the American judicial system

    Does he respect the judicial system in Sri Lanka , from where he originates. In SL he would have paid his way and remained a big man in our so called high society !

  • 6
    1

    Rajaratnam makes some valid points. Bharara was indeed a grandstanding prosecutor trying to advance his career; some other Hedge Fund managers accused of insider trading, such as Steven A Cohen, were treated leniently–Cohen paid a large fine and avoided prison. And there are indeed many gray areas when it comes to defining what insider trading is.

    But on the whole, his arguments sound like a speeding driver who gets caught complaining about the police ignoring other speeding drivers. It happens all the time, and it is how enforcement works. He doesn’t appear to offer any compelling defense against the allegations of his misdeeds.

    • 7
      2

      Agnos
      I think that Emil Savundara was far more impressive in the interview with David Frost.

  • 6
    0

    If you want to learn about insider dealing in Sri Lanka study what happened at EXPO Lanka between 2020 and 2021.

    In 2020 EXPO Lanka was selling at about 7 rupees. Then came Covid. Examine the top 20 share holders of Expo in January 2020 and then in September 2020. There a few interesting new comers in that list in September 2020. Expo shot up to Rs 500.
    These new comers made a killing ( Rs 7 to Rs 500!)

    Either they are brilliant economists/market gurus or they had insider information. What do you think ? Study the names again.

  • 0
    1

    “nstead, Rajaratnam, not unaware that those charged with ‘insider trading’ had a ninety-seven percent conviction rate decided to go to trial. It was a decision not taken lightly. In Rajaratnam’s own words: “I went through a period of soul-searching. Why was this happening to me? Ultimately, I realized that I had to fight for my innocence and resolved to fight the battle to the finish”.”

    thats all bullshit.He was caught redhanded in the phone bugging which was the first time the authorities had everdone it.He had no chance of not being convicted.I was wondering at that time why he was not pleadiing guilty and get a good lawyer to get him the best deal possible because the courts also would have been happy to not have to waste time and money.then i read somwhre lo and behold his sikh wife had told him that the astrology favours him and go and fight.ye gods how could a man who came up like this make momentous decisions based on astrology like mahinda having early elections in 2015 based on what his astrologer told him.either their IQ is low or they don’t have common sense or both.Rajaratnam has only himself to blame and waste of time trying to get sympathy form his book.maybe he had nothing to do anyway for 7.5 years so might as well write it.

    • 2
      1

      cont

      However this man is not a common criminal.He with the greatest difficulty paid back all the money owed to people who trusted him and gave their wealth,unlike so many others who have played out people who trusted them.He did insider trading which everybody was doing in wall street,but for whatever reason was singled out to teach a lesson to others.Poor fellow,i feel sorry for him.

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