Rivals circle Galleon staff

City A.M. Reporter
GALLEON Group, the hedge fund firm at the centre of a sweeping insider-trading scandal told investors in a letter yesterday that it has been contacted by several investment firms inquiring about its employees and that it plans to return capital in the coming months.<br /><br />Galleon founder and chief investment officer Raj Rajaratnam was one of six people arrested by US authorities last month on charges that they participated in a scheme to share and make trades on inside information.<br /><br />Within days, as a line of investors demanded their money back, Galleon announced that it would liquidate its funds.<br /><br />In a brief monthly letter, Galleon stressed that its funds &ldquo;performed well in October, despite having to wind down our portfolios&rdquo;.<br /><br />Most capital will be returned shortly after 30 November fund values are calculated, with the remainder distributed once year-end results are audited and some less-liquid securities are sold. Galleon said it continues to weigh strategic alternatives for its funds and seeking opportunities for its employees.<br /><br />Prosecutors are understood to now have more than one co-operating witness, who were cited in court papers but not identified by name.