Update on Galleon Group

From Dealbreaker, and the "that didn't take long" category. Note the phrase at the bottom: "We could be closed by Friday. Too many of our clients are institutions that are prohibited from doing business with alleged felons.”

dealbreaker.com/2009/10/investors-pulling-money-from-g.php

Investors Pulling Money From Galleon Tech Fund, Galleon Risk Management Head: “We Could Be Closed By Friday”

Posted by Teri Buhl, Oct 19, 2009, 3:05pm

The Galleon Group said Friday that it “continues to operate and is highly liquid” but one of firm’s top lieutenants is admitting he doesn’t think the shop will last long.

Traders close to Sanjay Santhanam, a Galleon partner and head of risk management, told Dealbreaker he’s admitted defeat. The firm is already seeing investors withdraw their money out of Galleon’s technology fund, according to the Wall Street Journal.

The technology hedge fund run by Galleon Group founder and insider-trading suspect Raj Rajaratnam allows investors to withdraw their money monthly, a much shorter time horizon than many hedge funds, including others at Galleon. Rochdale Investment Management, an investor in a diversified hedge fund that is Galleon’s largest, has already said it’s withdrawing all its money from that fund.

When asked about investor withdrawals on Monday, a Galleon spokesman declined to comment.

The chief executive of Rochdale told Dow Jones Newswires on Monday it will liquidate its entire position in Galleon Group’s largest hedge fund, Galleon Diversified Fund. The statement came three days after Mr. Rajaratnam’s arrest on charges of insider trading.

Sources tell Dealbreaker that Santhanam has told people close to him: “We could be closed by Friday. Too many of our clients are institutions that are prohibited from doing business with alleged felons.”
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