Daily Archives: June 20, 2011

John Gapper

The impression I am left with from reading George Packer’s account in the New Yorker of the Raj Rajaratnam prosecution is of how the odds still favour the determined insider trader who takes precautions.

Packer recounts how the Rajaratnam case, which ended up as the biggest insider trading investigation ever known on Wall Street –  claiming scalps including Rajaratnam and Anil Kumar, a former McKinsey partner — gained momentum as a result of a single instant message conversation:

rajatgalleon: hey
rajatgalleon: u back
roomy81: i am here
roomy81: did not go any where
rajatgalleon: call me..just got back today
roomy81: please let me know on JNPR
roomy81: donot buy plcm till i het guidance
roomy81: want to make sure guidance OK

Not only was it very hard to mount a criminal case against Rajaratnam until that lead enabled prosecutors to tap his work and personal phones but it was incredibly labour-intensive for the lawyers and prosecutors. Read more >>