Anil Kumar, a former director at management consultancy McKinsey & Co, has admitted to his involvement in the Galleon Group insider trading ring.
As part of his guilty plea, Kumar said that he had received $1.75 million by Galleon Group founder Raj Rajaratnam for inside information about clients of McKinsey.
Kumar added that he had received a total of around $2.6 million for his role in the scam.
He said he received payment for his services from the Galleon Group via a Swiss bank account – money he then invested in the hedge fund using an account in the name of one of his employees at home.
Kumar met Rajaratnam in the 1980s when the pair attended the Wharton School of Business at the University of Pennsylvania.
After admitting his guilt, Kumar offered an apology to his former colleagues.
"I understood Mr Rajaratnam was going to trade securities. I understood that my conduct was unlawful," he said.
"To all my colleagues whose trust I have betrayed, I am sorry."
The insider trading relating to Kumar's case centered around the acquisition of ATI Technologies by Advanced Micro Devices (AMD).
Kumar's claims have been denied by lawyers for Rajaratnam, who insist no such payments were made.
John Dowd, Rajaratnam's lawyer, said that Galleon Group's making of investments based on a potential merger did not mean it had insider knowledge of the deal.
"An analyst's prediction that AMD would acquire ATI was widely reported in the press more than seven weeks before the acquisition was announced," he stated.
In November last year, Hector Ruiz, the chairman of AMD, resigned from his role at the company after it was alleged in widespread newspaper reports that he had also passed on secret information about the company to the insider trading ring.
However, no charges have been bought against Mr Ruiz by US prosecutors.
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