Yesterday, the SEC announced that U.S. District Judge Jed S. Rakoff had granted a $34.5 million final judgment in its favor against Galleon defendant Deep Shah.  The SEC alleges that Shah was involved in the same broad insider trading scheme for which Raj Rajaratnam was recently convicted. Specifically, the SEC alleges that while employed at Moody's as a lodging industry analyst, Shah provided an investor named Roomy Khan with inside information on multiple acquisitions of public companies. Khan allegedly traded based on the information and also tipped others, including Rajaratnam, about the upcoming acquisitions.

The SEC says that it is “pleased with the decision” but the agency probably is not planning on seeing this $34.5 million ($10 million in alleged ill-gotten gains, plus a $24.6 million penalty) any time soon. Shortly after he was charged both criminally and by the SEC in the case in late 2009, Shah disappeared and was declared a fugitive. The SEC stated in court documents filed in March 2011 that it believed a bailiff had finally located Shah in the Juhu neighborhood of Mumbai, India--"living in high style on the beach" according to one publication. The bailiff left an amended complaint of the SEC's complaint on the door of Shah's Juhu home but, five months later, Shah has predictably chosen not to respond.

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