Sri Lanka-born billionaire Raj Rajaratnam, the main accused in the biggest hedge fund insider trading case in US history, went on trial and he could face more than 20 years in prison if convicted in the case which also involves several Indian-origin suspects.
Indian-American Rajat Gupta , former director of Goldman Sachs, is one of the persons who allegedly tipped 53-year-old Rajaratnam.
Gupta is not an accused in the case but US markets regulator Securities and Exchange Commission's Enforcement Division alleged last week that Gupta fed Rajaratnam inside information about earnings at Goldman Sachs and Procter and Gamble when he was a board member at those companies.
The high profile trial commenced with the Jury selection process in a packed District Court in Manhattan on Tuesday with US District Judge Richard Holwell coming out with a 15-page questionnaire to determine whether the juror had any prejudices that would prevent the person from taking an impartial view of the facts to be presented in the case.
Holwell introduced Rajaratnam to 100 prospective jurors by calling him "a wealthy individual."
A total of 12 jurors are to be selected along with six alternate jurors. Holwell also asked some people to approach the bench and questioned them privately. Jury selection will be followed by opening statements from both sides.
The case is the first of its kind where authorised wiretapping and information was used and the trial is expected to be wrapped up in a couple of months.
The central question in the case is whether, founder of Galleon Group of hedge funds, accumulated $45 million using leaked confidential information. Unlike many of his co-accused, the business tycoon has not pleaded guilty.
Holwell said the trial would last two months and include testimony from more than 100 witnesses, which include Lloyd Blankfein, CEO of Goldman Sachs Group.
The trial was expected to feature dozens of secretly taped conversations between Rajaratnam and partners in the hedge fund industry. The Manhattan resident has remained free on $100 million bail since his arrest despite efforts by the government to have him held without bail before trial.
One of Rajaratnam's lawyers, John Dowd, has said Rajaratnam only acted on information that was already public whenever he instigated trades.
Rajaratnam, who is charged with 14 counts of securities fraud and conspiracy, could face 20 years in prison if convicted. So far, 19 people have pleaded guilty in the case including Rajiv Goel, former Intel executive, and Anil Kumar, a former director at McKinsey & Co.
Rajaratnam was charged in October 2009 with securities fraud and conspiracy to commit securities fraud by prosecutors who said he made more than $50 million illegally by teaming up with others in the industry to glean secrets from employees of public companies.
The case has resulted in more than two dozen arrests and 19 guilty pleas, including many people who are cooperating with the government.
Rajaratnam was represented in court by seven lawyers.