Defendant praised at insider trading trial in NYC

AP News
Posted: Apr 13, 2011 7:15 PM
Defendant praised at insider trading trial in NYC

A New York education advocate featured in an award-winning documentary testified Wednesday on behalf of a wealthy hedge fund manager facing insider trading charges, telling a jury his "dear friend" deserves high marks for philanthropy.

Raj Rajaratnam "had a genuine concern for children," Geoffrey Canada, president of the Harlem Children's Zone, testified. "Raj's wish was that we could level the playing field for kids."

Prosecutors allege Rajaratnam fixed the game on Wall Street by using confidential information on massive trades. They say the illegal tips netted him $68 million, making it the largest hedge fund insider trading case in history. The Sri Lankan-born Rajaratnam has pleaded not guilty to conspiracy and security fraud charges.

Lawyers for the Galleon Group founder insist he relied solely on expert analysis and research to amass a multibillion-dollar fortune for his clients and himself.

Canada appeared last year in "Waiting for Superman," a film about the struggles of the public school system. His nonprofit serves 11,000 needy students in Harlem by steering them toward a college education.

Called by the defense on Wednesday as a character witness, the charismatic Canada was effusive in his praise for Rajaratnam.

"Raj is a dear friend of mine," he said.

He described how he and Rajaratnam "hit it off right away" when they met about eight years ago. He dismissed the notion that Rajaratnam was motivated by greed, saying the defendant jumped at the chance to give time and money to his cause.

"I never had to convince Raj. ... He volunteered the support," he said.

Canada also recalled hearing news of Rajaratnam's arrest in 2009, and how he came forward to sign a $100 million bond to help win his friend's his release. He drew laughter in the courtroom when he smiled and interjected, "I don't personally have $100 million to guarantee his release."

The trial is in its sixth week in federal court in Manhattan. The judge told the jury on Wednesday that it will likely hear closing arguments next week.