NEW YORK (Reuters) – Rengan Rajaratnam, the younger brother of imprisoned hedge fund manager Raj Rajaratnam, pleaded not guilty yesterday to insider trading charges.
The younger Rajaratnam entered his plea in Manhattan federal court, one day after his arrest at John F Kennedy International Airport in New York. Vinoo Varghese, an attorney for Rajaratnam, said his client arrived in New York early Sunday morning, accompanied on a flight from Brazil by an FBI agent.
Prosecutors on Thursday accused Rengan Rajaratnam, 42, of conspiring with his brother to trade on non-public information concerning Clearwire Corp and Advanced Micro Devices Inc in 2008.
Rajaratnam appeared in court dressed in a blue dress shirt, blue jeans and a dark suit jacket Varghese gave him upon entering the courtroom.
“Not guilty, your honour,” he said when US District Judge Naomi Buchwald asked him for his plea. Rajaratnam agreed to the judge’s request to refer to him as “RR”
Lawyers for Rengan Rajaratnam said their client learned through news reports that he had been charged, and volunteered to return immediately from Brazil, where he had lived and worked for the past year, to defend himself.
“Within a matter of hours, Mr Rajaratnam literally dropped everything and headed to the airport,” Varghese told Buchwald. Varghese added that Rajaratnam offered to pay the FBI agent’s plane ticket and that he was “mentally and physically drained” from the past 72 hours but determined to defend himself.
The government did not seek Rajaratnam’s detention because he volunteered to U.S. authorities to return immediately to face the charges, Assistant US Attorney David Massey said at the hearing. He remains free on a $1 million bond secured by $500,000 in cash and property, Massey said.
Rajaratnam, a US citizen born in Sri Lanka, has surrendered his US passport to the FBI and will be allowed to stay at a Manhattan residence, Massey said. He will also receive mental health counselling because of the stress he is under, Massey told the court.
Buchwald set June 4 for the next court date in the case.
