Galleon case: ex-Intel exec in SEC accord

NEW YORK, USA: Rajiv Goel, a key cooperating witness in the government's criminal insider-trading case against Galleon Group hedge fund founder Raj Rajaratnam, has agreed to pay $254,000 to settle a related U.S. Securities and Exchange Commission civil lawsuit.

The settlement with Goel, a former director of the treasury group at Intel Corp's investment arm and a longtime friend of Rajaratnam, was revealed in a order signed by U.S. District Judge Jed Rakoff in Manhattan and made public on Monday.

David Zornow, a lawyer for Goel in the criminal case, declined to comment. Goel pleaded guilty in February to fraud, telling a New York court Rajaratnam gave him money for personal needs and that he profited from illegal trades.

Rajaratnam is seeking to exclude wiretap evidence from his criminal case, in which he is accused of securities fraud and conspiracy.

He and co-defendant Danielle Chiesi, a former trader at New Castle Funds in New York, are slated to be tried early next year. Both have denied wrongdoing. A different Manhattan federal judge, Richard Holwell, is handling that case.

Prosecutors call Rajaratnam the central figure in the largest U.S. hedge fund insider trading scheme ever uncovered.

Twenty-one people have faced criminal or civil charges, and 12 have pleaded guilty.

Roomy Khan, another witness against Rajaratnam, in October settled with the SEC for $1.86 million.

The case is SEC v. Galleon Management LP et al, U.S. District Court, Southern District of New York, No. 09-08811.