Typically in families where their are children of the same sex, one of two dynamics exists. In scenario one, big brother (or sister) is the star, excelling at everything he or she does, making it impossible for the younger sibling to live up to the highly set bar. In scenario two, the younger sibling outpaces the older, making the first born feel like a fuck up for not having the same successes as junior. In the Rajaratnam family, the former was the case. Whereas Raj was married with a bunch of kids, little bro Rengan struggled to meet women, noting that it felt like “they’ve all gone away or someone snatched them up.” Whereas Raj ran a multi-billion dollar hedge fund, Rengan had a dinky little shop with assets under management barely hitting 200 million, seeded by his bro. And whereas Raj (allegedly) had some of the best insider trading skills on the Street, Rengan embarrassed himself trying to beat the press on hot tips.

The younger brother of Galleon Group founder Raj Rajaratnam called him in a panic in March 2008 after The Wall Street Journal published an article about a secret wireless venture the hedge-fund manager allegedly knew about from a confidential source at a company involved in the deal. In the call, which was caught on a federal wiretap and played Thursday at Raj Rajaratnam’s insider-trading trial in Manhattan, Rengan Rajaratnam appears to be frustrated that his ability to make trades ahead of the deal would be hampered now that it was public.

“Oh dude, we’re f—” Rengan Rajaratnam said, according to the tape played for jurors. “It just hit The Wall Street Journal.”

“What’s that?” Raj Rajaratnam asked.

“The Clearwire stuff,” his brother said.

Not saying living for so many years in Raj’s shadow finally caused Rengan to snap and rat him out, but not not saying it, either.

Galleon Jurors Hear Panicked Call From Rajaratnam Brother [WSJ]

Article courtesy of Dealbreaker

As you might have heard, yesterday was the most majestic day of the Raj Rajaratnam insider trading trial, as it starred witness Lloyd Blankfein. After several hours of questioning (and one patently absurd effort by the court illustrator), the judge called for a quick break. During that time, Lloyd apparently “walked up to defense lawyer John Dowd,” with whom he “exchanged some words and a laugh,” and then “rapidly extended his arm and quickly shook Rajaratnam’s hand.” A very brief dialogue ensued, Raj “smiled” and Blankfein walked away. What did LB say to elicit the grin of the former Goldman client?

Unfortunately, the two men weren’t wearing mics, so we have no idea. But! Surely we can take an educated guess, being intimately familiar with both parties’ thinking. Did Lloyd tell Raj:

* “Don’t worry, we’ve got no beef with you. It’s Gupta who will die for this.”

* “If you take the stand it helps to picture the jury in spandex yoga pants.”

* “I saw your tourney bracket and you are fucked.”

* Wildcard

Article courtesy of Dealbreaker

Gang, something serious just happened during the Lloyd Blankfein Day of the Raj Rajaratnam insider trading trial. Someone needs to be removed from the court immediately and if the judge won’t do anything about it, we will. We’e not talking about Raj, or his 700 lawyers or the prosecution or Lloyd. We’re talking about the person responsible for THIS:

In what universe does that look like LB? This illustrator needs to be remanded without bail, markers confiscated.

Article courtesy of Dealbreaker

As you might have heard, Lloyd Blankfein has been testifying this morning in the Raj Rajaratnam trial. Lloyd is there because one of Rajaratnam’s alleged insider trades was based on information he received from former Goldman Sachs board member Rajat Gupta. To recap, Gupta took part in a fall 2008 conference call with GS management and fellow board members and after hanging up, made himself wait exactly twenty three seconds before getting Raj on the horn. Was this cool with LB and was it considered an acceptable course of action for those lucky enough to be part of Goldman’s inner sanctum, prosecutors asked?

You bet your asses it was not.

“On that call, did Rajat Gupta violate Goldman Sachs’s confidentiality policy?” Special Assistant U.S. Attorney Andrew Michaelson asked.

“Yes,” Mr. Blankfein said.

Mr. Blankfein wore a dark suit. He smiled at the gathered gaggle of reporters covering the trial as he walked in the courtroom and gestured with his hands as testified.

Blankfein: Gupta Violated Board Confidentiality [WSJ]

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$$$ “You weren’t charged with money laundering, right?” Rajaratnam’s main lawyer, John Dowd, asked Kumar, who has been on the witness stand in Manhattan federal court for three days. “You understand that they could have charged you?” “Yes,” Kumar replied glumly after a long pause. [Reuters]

$$$ Morale Is High At The SEC [FINS]

$$$ Japan Nuclear Reactor Fire Heightens Radiation Fears [Reuters]

$$$ Apple Delays Launch Of IPad 2 In Japan Following Disaster [WSJ]

$$$ Ruth Madoff Account Got $14 Million Via Fraud, Trustee Says [Bloomberg]

$$$ “It’s very stressful, you know every day you come in and it’s, I feel like I’m fighting Muhammad Ali,” Mr. Rajaratnam said. “I know he’s stronger and he’s faster, but you’re in the ring with him. And he doesn’t just, you know, you try to survive and hope that he gets tired, you know?” [Dealbook]

Article courtesy of Dealbreaker

Time was, Anil Kumar was Raj Rajaratnam’s “hero” and “star.” That was when Anil was giving Raj the good stuff, meaning hot material, non-public information about various companies that the Galleon founder could trade on. Then Kumar’s work started slipping, in comparison to fellow foot soliders like Danielle Chiesi, whose red fishnet stockings Kumar could not compete with and before you knew it, Anil wasn’t even worth the $1 million/year Rajaratnam was paying him for tips.

Kumar wants to “be a mini-Rajat” without “bringing anything to the party,” Rajaratnam told Gupta on the recording. Rajaratnam said on the tape that he had been paying Kumar $1 million annually for years — “after-taxes, offshore, cash” — in return for “little or nothing.” “Keep your eyes and ears open,” Rajaratnam told Gupta. “If you hear anything, just anything you think may be interesting — which I will track down and see what’s in the market — I’ll bring that angle to you.”

Anil got to hear that dialogue today in court. Must have stung. Better to know, now though, that Raj is a ‘what have you done for me lately’ guy. Also nice how makes one underling feel good by making another one feel bad, just as we suspected while playing arm-chair psychologist earlier today.

Article courtesy of Dealbreaker

While richly compensating employees, consultants and/or people providing you with material non-public information for jobs well done is probably the biggest factor in encouraging performance, a good manager knows there are other important ways to motivate people. As a Wharton grad, Raj Rajaratnam knew full well the benefit of patting lessors on the head to make them feel like a valuable member of the team so they continue to strive for your approval and affection. Take Anil Kumar. In 2006 he informed Raj of AMD’s plans to acquire ATI Technologies, in a project that was code-named ‘Supernova’ and ‘Go Big.’

Initially, the Galleon founder almost didn’t believe the tip. “This is completely ridiculous, it makes no sense. … Are you absolutely sure?’” Kumar, testifying Monday, said Rajaratnam told him. Once Kumar confirmed it was true, a grateful Rajaratnam told him, “Wow, this is really useful.” And then later:

After the deal was announced, Mr. Kumar said, Mr. Rajaratnam told him, “We’re all cheering you right now. … He said something like, ‘You’re a star, or you’re a hero.”

Anyone with a cash cow on their payroll would be wise to take note.

Galleon Witness Testifies of ‘Super Confidential’ Deal Tips [WSJ]

Article courtesy of Dealbreaker

People helping people is all this is about.

Kumar has admitted accepting $1.75 million from Rajaratnam, a one-time billionaire, in exchange for supplying tips on McKinsey clients, including chipmaker Advanced Micro Devices. On the witness stand, he recounted that the Galleon Group hedge fund founder told him: “You work very very hard. You are underpaid. People are making fortunes … so just keep track of your knowledge and share it with me.”

And for this he should be punished? If helping out a friend in such a way is wrong, Raj doesn’t want to be right. Also, who’s to say Raj was looking for ‘knowledge’ about publicly traded companies? He could’ve very well been asking Kumar to share his formidable pop culture knowledge as Big R geared up for trivia night and the request was misinterpreted. The defense rests!

Ex-McKinsey partner tells jury he tipped Rajaratnam [Reuters]

Article courtesy of Dealbreaker

Jury selection for the trial of hedge fund manager Raj Rajaratnam has been officially completed and opening statements will be heard this afternoon. The details on the final group are scant, but here’s what’s known:

* There are twelve jurors
* There are six alternates
* Of the A-team, there are five men and seven women

Will those odds work in what some might consider to be a heartthrob’s favor? Place your bets.

Galleon Jury Gets Seated [WSJ]

Article courtesy of Dealbreaker

This could set a precedent for all future accused insider traders.

Rajaratnam came to court with seven lawyers. There is a row of two tables reserved for the defendant and his lawyers and Rajaratnam is sitting at a seat at the far left of the second table, as far away from the jury box as possible. In the first row are his lead defense lawyers, John Dowd and Terence Lynam of Akin Gump Strauss Hauer & Feld LLP.

Rajaratnam Trial Begins [Bloomberg]

Related: “In the conference room was a dwarf whom Mr. Rajaratnam introduced as an analyst hired to cover “small-cap” stocks. He was, in fact, an actor hired for an April Fool’s Day gag.”

Article courtesy of Dealbreaker