By Walter Jayawardhana

The founder of Galleon Group Hedge Fund , Sri Lanka born Raja Rajaratnam was arrested charged with criminal offences of Insider trading securities frauds.

ƒÆ’-¡ƒ”š‚ Galleon is a major hedge fund player known for its investments in technology stocks.

ƒÆ’-¡ƒ”š‚ The FBI said Rajaratnam was charged with four counts of conspiracy and eight counts of securities fraud. He was arrested in his apartment during the night of October 15.

ƒÆ’-¡ƒ”š‚ The Galleon group has nearly three billion dollars under its management.

ƒÆ’-¡ƒ”š‚ The charges arose on stocks including Hilton Hotels, AMD, Clearwire,Google and Akamai.

ƒÆ’-¡ƒ”š‚ The hedge funds named in the case are New Castle, Galleon Technology, and Intel Capital. Others charged criminally in the case include Rajiv Goel, director in strategic investments at Intel Corp.’s investment arm; Anil Kumar, a director at global management-consulting firm McKinsey & Co.; Danielle Chiesi and Mark Kurland of New Castle Partners LLC, the one-time equity hedge-fund group at Bear Stearns Asset Management Inc.; and Robert Moffat, a senior vice president at International Business Corp. (NYSE:IBM).

ƒÆ’-¡ƒ”š‚ The insider trading case is said to be for about $20 million, and involved the stocks of International Business Machines (NYSE:IBM), Advanced Micro Devices (NYSE:AMD), and Sun Microsystems (NYSE:SUN). Other companies included Google (Nasdaq:GOOG), Polycom (Nasdaq:PLCM), and Hilton Hotels.

The New York Daily News said after the arrest: ƒÆ’‚¢ƒ¢-¡‚¬ƒ…-“The defendants operated in a cozy world of you scratch my back, I’ll scratch your back,” Manhattan U.S.Attorney Preet Bharara said at a news conference announcing the arrests.

ƒÆ’‚¢ƒ¢-¡‚¬ƒ…-Rajaratnam, who Forbes ranked as No. 559 on its 2009 list of the world’s billionaires, was snared in a $20 million insider-trading case touted by the authorities for its first-ever use of court-authorized wiretaps against Wall Streetbig wheels.

“They may have been privy to a lot of inside information, but there was one secret they did not know – and that was that we were listening,” Bharara said.

The six suspects are accused of having enriched themselves by using non-public information about companies that included Google, Hilton Hotels and Sun Micro Systems.

Some of their conversations intercepted by investigators via wiretap are detailed in the federal criminal complaint.

“I’m dead if this leaks,”Dannielle Chiesei, who worked for the one-time equity hedge fund group of Bear StearnsAsset Management, is quoted as saying. “I’ll be like Martha f—— Stewart.”

Rajaratnam, whose fortune was pegged by Forbes as $1.3 billion, is accused of being at the heart of several insider trades by leading Galleon Technology Funds to make dirty deals off privileged information.

Authorities said the Sri Lankan hedge fund guru used his high-level contacts at other Wall Street firms to engage others in the scheme.

“He is not a master of the universe,” said Robert Khuzami director of enforcement for the Securities and Exchange Commission. “He is a master of the Rolodex.”

The others charged includeMark Kurland, a top executive at New Castle Funds;Rajiv Goel, a director at Intel’s investment arm; Anil Kumar, an executive with the consulting firm McKinsey and Companyand Robert Moffat, a senior vice president at IBM