NEW YORK (UPI) -- New York billionaire Raj Rajaratnam was arrested for insider-trading with help from executives at IBM and Intel, federal prosecutors said.

Rajaratnam, 52, founder of the New York hedge fund Galleon Group, was among six money managers and hedge-fund operators charged Friday with conspiracy and securities fraud.

The defendants allegedly earned $20 million selling and trading on inside information passed from tipsters to the defendants, U.S. Attorney Preet Bharara said at a news conference in New York.

Executives from hedge funds, investment firms and IBM and Intel aided authorities in the investigation, seen as an offensive by the Obama administration against white-collar criminals, The San Jose Mercury News reported Saturday.

For the first time, federal agents used court-authorized wiretaps to target insider trading, tapping Rajaratnam's phone in the same way organized crime and drug cartels have been investigated.

"These people were privy to inside information, but they didn't know one secret, that we were listening," Bharara said.



Copyright 2009 by United Press International

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