BBC World News got the nationality of Raj Rajaratnam wrong on its news trailers and crawlers last night (19).

More than 24 hours after the arrest of Raj Rajaratnam by the New York Police for insider trading, the BBC kept on repeating that he is a “Sri Lankan Billionaire”.

This is what the trailers and crawlers said: “The Sri Lanka stock market fell sharply over then arrest of a Sri Lankan Billionaire in New York on insider trading charges.”

Observers noted this as surprising for a news organization that regularly stresses on the ethnic differences in Sri Lanka in its news presentations, with references to the Sinhalese-Buddhist majority and Tamil-Hindu minority.

Raj Rajaratnam was born in Sri Lanka but migrated to the USA as a child and has been a US citizen for a very long time, amassing a fortune, especially as a Hedge Fund dealer. The Colombo Stock Market reacted adversely to news of his arrest due to the extensive holdings he and funds managed by him have in Blue Chip companies of the CSE.

In the midst of much speculation about the status of inquiries into Rajaratnam’s financial dealings, the Central Bank of Sri Lanka issued a statement yesterday, stating: “investigations are yet continuing in relation to the funding allegedly provided by Mr Raj Rajaratnam to the TRO. Accordingly, any reports that suggest that such investigations are concluded or that Mr Rajaratnam has been cleared of possible involvement are incorrect and misleading.”

It will be recalled that Rajaratnam made his entry to the Colombo Stock Market in 2003, after the signing of the Ceasefire Agreement between the UNP Government and the LTTE, facilitated by Norway. His extensive contributions to the Tamil Rehabilitation Organization (TRO) known as a front organization of the LTTE and banned in Si Lanka and the USA are well known. It is estimated he has invested more than $150 million in Sri Lanka.

The New York hedge fund billionaire, Raj Rajaratnam is accused of operating an alleged $20 million insider trading scheme through his Galleon Group hedge fund, and other questionable financial dealings.

He is one of the wealthiest men in America with an estimated net worth of $1.3 billion and he was a major contributor to the polls campaign of Hillary Clinton and Barack Obama, also the single largest known U.S. contributor to an alleged charity linked to the LTTE – the TRO, which provided funds for the LTTE’s terror campaign.

Bloomberg.com reported that: “Rajaratnam’s net worth of $1.3 billion makes him the 559th richest person in the world, according to Forbes Magazine, on par with the likes of hedge-fund manager Julian Robertson and investor Wilbur Ross. Rajaratnam has invested in at least two New York City restaurants, Opia, in midtown Manhattan, according to people who know him, and Rosa Mexicano.

Galleon was among the 10 largest hedge funds in the world in the early years of this decade, and it managed $7 billion at its peak in 2008. It also was one of the three largest technology hedge funds along with Lawrence Bowman’s Bowman Technology Fund, which closed in 2001, and Daniel Benton’s Andor Capital Management LLC, which shut down last year.

Galleon’s $1.2 billion Diversified fund has climbed 21.5 percent a year, on average, since 1992, according to a September marketing document from the firm, compared with 7.6 percent for the Standard & Poor’s 500 Index of the largest U.S. companies. The fund has returned 22.3 percent this year, according to an investor letter.

Charitable Giving

As Rajaratnam’s wealth grew, he and his wife Asha Pabla, who have three children, created a family foundation and have given money to fight AIDS in India. They donated $5 million to help the 2004 tsunami victims in his home country of Sri Lanka, where Rajaratnam was on vacation with his family when the disaster struck.

The foundation donated $400,000 in 2005 to the Tamils Rehabilitation Organization in Cumberland, Maryland, according to tax forms filed by the foundation with the Internal Revenue Service. Two years later, the U.S. Treasury Department froze the assets of the charity, saying it was a front for the Liberation Tigers of Tamil Eelam, or LTTE, which the State Department had designated as a terrorist group 10 years earlier.

‘Thousands of Homes’

“His donation was responsible for rebuilding thousands of homes for Tamils, Sinhalese, and Muslims without discrimination,” Dan Gagnier, a spokesman for Galleon, said in an e-mailed statement.
Sri Lanka authorities will review “significant” transactions carried out by Rajaratnam, Channa De Silva, director general of the Securities and Exchange Commission of Sri Lanka, said in an interview today. The agency will “collaborate” with foreign governments in their investigations.

“We don’t want a market glazed with investors of this reputation and will make every attempt to keep the Sri Lankan market clean,” De Silva said, Bloomberg reported.

Meanwhile, Reconstruction and Rehabilitation authorities here said there is little evidence of any large numbers of house being built for any community affected by the tsunami on 2004 from Rajaratnam’s Funds, any other related donations, or by the TRO.