An accused hedge-fund pirate yesterday told his crew at Galleon Group that he is innocent of bombshell insider-trading charges — but freaked-out employees and investors are looking to flee what could well be a sinking ship.
Raj Rajaratnam, 52, made his first appearance at Galleon’s offices on Madison Avenue since being busted Friday by federal authorities who claim his fund traded after illegally being fed sensitive information about large companies such as IBM and Google.
Rajaratnam, who is free on $100 million bail, told some employees that he is not guilty of the charges — but the burly billionaire’s personal assurance might not be enough to keep Galleon afloat.
The hedge fund had on hand five days of liquidity — cash or easily converted assets — meaning that unless Galleon can raise money quickly it could be forced to close, sources said.
Compounding that squeeze is the fact that investors are looking to take out their money.
Among them is Rochdale Investment Management, which said it will liquidate its entire position in a Galleon fund.
A number of Galleon employees also are eyeing the exits, the sources said.
Meanwhile, top IBM exec Robert Moffatt was placed on leave and stripped of his corporate-officer post because of his arrest Friday for allegedly leaking inside information to Danielle Chiesi, a stock trader who herself was charged with feeding Rajaratnam information.