The Supreme Court rejected the appeal of former hedge-fund king Raj Rajaratnam to overturn his conviction and 11-year prison sentence for insider trading.
Rajaratnam, the founder of once-high-flying Galleon Group, was convicted of 14 counts of securities fraud and conspiracy in 2011. He is currently serving out his 11-year prison term and was fined $10 million and ordered to forfeit more than $53 million.
The former hedge-fund king argued in a petition that the trial judge should not have allowed prosecutors to use evidence obtained by the government wiretap of his cellphone. He also said prosecutors did not prove that inside information played a key role in his winning trades.
The Justice Department told the Supreme Court that it provided more than enough evidence that Rajaratnam's trades "were the direct and immediate result of his receipt of inside information," the department said. The Second U.S. Circuit Court of Appeals in New York upheld Rajaratnam's conviction last year.
The Supreme Court's decision to let Rajaratnam's ruling stand comes one week after it rejected a plea from former Goldman Sachs director Rajat Gupta to remain free on bail while he continues to challenge his conviction for passing along inside information to Rajaratnam.
The Galleon Group was one of the largest hedge funds in the world before shuttering in 2009 after Rajaratnam and five others were arrested and charged with operating a wide-ranging insider-trading operation.