Federal authorities arrested six people in a hedge fund insider trading case that led to $20 million in illegal profits, the Associated Press reported today. Manhattan prosecutors filed charges of conspiracy and securities fraud. The money was stolen as a result of tips shared by those working at two hedge funds. Raj Rajaratnam, Galleon Group founder and one of the defendants. Inside information regarding firms including Google, AMD, and Hilton Hotels. The hedge fund manager was listed in Forbes Magazine's rich list as the 236th richest American, worth $1.3 billion, notes BBC News. Galleon Groups has up to $7 billion in assets under its management.

The prosecution claims that the insider trading took place at the New Castle hedge fund and Intel Capital, investment arm of Intel for the purpose of trading in Akamai and Sun Microsystems. Unspecified usage of wiretaps was referenced in the article.

Other defendants in the case include Rajiv Goel, Intel capital director of strategic investments, and IBM systems and technology division of senior vice president Robert Moffat. Also involved are Anil Kumar, a director at global management-consulting firm McKinsey & Co and Danielle Chiesi and Mark Kurland of New Castle Partners.

A company representative confirmed that Goel works in Intel's finance organization's treasury department, and had been placed on administrative leave. According to CNET, Intel said it was never contacted by investigation authorities.

Not only is the case of note due to the large number of tech industry firms involved, but US attorney Preet Bharara remarked in a press conference that this was the largest hedge fund case ever prosecuted. "Greed is not good," Bharara said. "This case should be a wake-up call for Wall Street." He added that potential financial fraud should ask themselves, "is law enforcement listening?"

Rajaratnam's favorite quote, according to the Wall Street Journal, was from Intel founder Andrew Grove: "Only the paranoid survive."