The accusations may be “baseless,” as Raj Rajaratnam describes the insider trading charges against him, and the plan may be to continue to operate like business is going on as usual, but Galleon clients are heading for the door.
WSJ: Investors have sought to withdraw about $1.3 billion of the $3.7 billion in assets Galleon manages, traders say. Moreover, two of the brokerage firms Galleon normally deals with, Bank of America Merrill Lynch and Barclays PLC, have told Galleon they will no longer trade securities positions with the fund firm, according to a person close to the situation.
Both Merrill and Barclays declined to comment, as did Galleon Group.
Inside Galleon, this signaled that some trading partners were pulling back amid worries that Galleon’s assets could be frozen in the pending probe. There was no specific threat that they would be frozen, however, and Galleon deals with about 10 other brokerage firms besides those two. So far, it has had no difficulty selling stocks. Read the whole thing >