WASHINGTON (AP) — A former executive at a technology firm in Silicon Valley is settling charges lodged by federal regulators that he provided insider information to convicted Galleon hedge fund manager Raj Rajaratnam.
Dozens of people have been charged in the case, one of the biggest insider-trading probes in history. The hedge fund founder relied on tips from insiders to obtain roughly $75 million in illicit profits.
The U.S. Securities and Exchange Commission said Friday that former Xilinx Inc. chief financial officer Kris Chellam shared confidential information with Rajaratnam in 2006 that indicated the company would fall short of its public revenue projections. That enabled the hedge fund manager to short sell the stock illegally for nearly $1 million in estimated profit.
The two men were close friends at the time. Chellam also had a substantial investment in Galleon and was in talks with Rajaratnam about possible employment at the hedge fund. Chellam was hired by the hedge fund in May 2007, the SEC said.
Chellam, who lives in Saratoga, Calif., has agreed to pay more than $1.75 million to settle the charges.
A representative for Xilinx, which is based in San Jose, Calif., was not immediately available to comment.