The prosecution of Rajaratnam began today, about an hour ago, with him ushering in an entourage of legal advice that would make OJ Simpson envious.
If you missed this, the man was guilty of pushing insider information, sometimes literally seconds after he found out about it.
Look, the guy is obviously guilty; I don’t think anyone in their right mind could possible defend this guy. Obviously, that statement is excused when talking about the seven lawyers who are even now attempting to do just that.
The real problem here is going to be the impact it has on the intelligence industry (and perhaps that includes the news). Having seen bits and pieces of the precursory raids up until now, it looks like the Feds are getting ready to try and charge every semblance of data sharing and intelligence gathering the hedge fund industry employs, which in my mind is not a far cry away from, “if it isn’t available on public sources, then you can’t know it.”
Perhaps this will be handled with tact and care; if this is just about crushing industry insiders who are front running their own announcements, or letting “special best friends” do the same, then so be it. But I have a hunch based on some of the hits before now, which have been including experts on hedge fund payrolls, that this is more about that rusted notion of a “level playing field.”
The US Government and supporting agencies have long had a peculiar public prejudice against hedge funds, which shows most vibrantly when the number of verdicts against hedge funds are compared alongside the number of allegations of wrongdoing. We’ll see if they can show some restraint, now that they seem to have an actual, real case to bring before the public.
Comments »