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Opening statements made in Galleon Group insider trading case

From Brian Vitagliano, CNN
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Galleon insider trading trial begins
  • Galleon Group founder Raj Rajaratnam goes on trial on insider trading charges
  • Prosecutor: Defendant "exploited a corrupt network of people" for his own gain
  • Defense: Rajaratnam "only traded on expert information"
  • Jury of seven women, five men will hear the case, expected to last 10 weeks

New York (CNN) -- Galleon Group founder Raj Rajaratnam used "stolen business information to steal tens of millions of dollars," a federal prosecutor said today in opening statements of what could be the largest insider trading trial in years.

Assistant U.S. Attorney Jonathan Streeter laid out in detail his case against Rajarantnam, a Wharton Business school graduate who Streeter said "exploited a corrupt network of people" for his own illicit gain.

Streeter cited wiretaps the government was able to obtain in 2008 to build its case.

Rajaratnam is charged with 14 counts of conspiracy and securities fraud. The government alleges he made $45 million from insider trading tips and conspired with others, including employees at Galleon, board presidents and consultants.

A jury of seven women and five men has been seated for the trial, which is expected to last 10 weeks. Rajaratnam could face 20 years in jail if convicted.

It took Streeter about an hour to run through the names of witnesses who will testify against Raj, who have "already pled guilty to insider trading."

Judge Richard Holwell's courtroom was overflowing with guests and media, causing two overflow rooms to be opened up.

After the government presented its opening statements, defense attorney John Dowd painstakingly went through almost every charge against his client, saying, "He is not guilty; he only traded on expert information."

Dowd said the government has it "wrong, and they want you to believe the words of the unbelievable."

He attacked the credibility of the presumed government witnesses, noting that each one faces 25 years in prison.

"They are on a leash," Dowd said. "The prosecution holds the keys to the jailhouse."

Court will resume Thursday at 9:30 a.m.