Galleon founder Raj Rajaratnam is escorted by FBI agents after being taken into custody in New York on Friday, October 16, 2009. (NYT file photo)
In the US, Federal and state authorities have charged 14 people with fraud and conspiracy as part of an insider-trading network that involves some of the same companies and individuals as the Galleon Group.
Authorities are calling it a wake-up call for Wall Street.
Federal prosecutors in New York charged 14 people with gaming the system to the tune of 20 million dollars in profits.
The 14 include two Indian names.
Mumbai based Deep Shah, a former analyst at Moody's Investors Service. Shah has been charged with passing on tips about Blackstone Group $26 billion takeover of Hilton Hotels before the deal was made public.
Gautham Shankar, a former proprietary trader at Schottenfeld Group in New York who has pleaded guilty.
"No one is trying to vilify Wall Street or demonise corporate America but there are rules and there are laws and no one is above the law," Preet Bharara, US Attorney, Manhattan.
Today's charges are the latest in an ongoing probe into Hedge fund insider trading on Wall Street. In October, Galleon founder Raj Rajaratnam and five others were charged criminally with insider trading. The SEC says Rajaratnam received tips from a network of high- ranking executives including co-defendants Rajiv Goel, who worked at Intel Capital, and Anil Kumar, who worked as a director at McKinsey & Co.
Three weeks ago, six people were arrested in what has become the biggest hedge fund insider trading case in US history. Today that number has gone up to over 20. While more arrests can still be expected as authorities continue to probe this scandal, the galleon case has once again exposed the ease with which Wall Street professionals disregard the rules and regulations for kickbacks and payoffs.