Billionaire held in Wall St probe

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Raj Rajaratnam, 52 - a portfolio manager for Galleon Group, a hedge fund with up to £4.4 billion in assets under management - was bailed on Friday, along with six hedge fund managers and corporate executives, in connection with a case described as "a wake-up call for Wall Street".

Rajaratnam was accused of conspiring with others to use insider information to trade securities in several publicly traded companies, including Google.

An FBI agent said Rajaratnam had a ticket to fly from Kennedy International Airport to London on Friday and to return to New York from Geneva, Switzerland, next Thursday.

US Magistrate Judge Douglas Eaton set bail at £6.25 million to be secured by £12.5 million in collateral despite opposition by prosecutors. He also ordered Rajaratnam, who has both US and Sri Lankan citizenship, to stay within 110 miles of New York City.

US Attorney Preet Bharara said it was the largest hedge fund case prosecuted and marked the first use of court-authorised wiretaps to capture conversations by suspects in an insider trading case.

"Greed is not good," Mr Bharara said. "This case should be a wake-up call for Wall Street."

Joseph Demarest, the head of the New York FBI office, said it was clear that "the 20 million dollars (£12.5 million) in illicit profits come at the expense of the average public investor".

The Securities and Exchange Commission (SEC), which brought separate civil charges, said the scheme generated more than 25 million dollars (£15.6 million) in illegal profits. Robert Khuzami, director of enforcement at the SEC, said the charges showed Rajaratnam's "secret of success was not genius trading strategies".

Galleon Group said in a statement it was shocked to learn of Rajaratnam's arrest.