His only request was to spread the money in the north, east and south.”Channelled through the John Keells charity arm, the 5 mil $ Rajaratnam donated!

Rajaratnam: mixed feelings in sri lanka

RATHGAMA, Sri Lanka (AFP)

Raj Rajaratnam, a billionaire financier facing insider trading charges in the United States, is recalled in stone in one of the villages he helped recover from the Asian tsunami in 2004.

A black granite monument honours the “Galleon Housing Scheme”, named after his Galleon Group hedge fund, in the palm-fringed and rustic village of Rathgama, 112 kilometres (70 miles) south of the capital Colombo.

Some of his most ardent fans want an even more visible tribute to his decision to build 100 new homes after the tsunami that killed 31,000 people in Sri Lanka.

“We will continue to push for the Galleon name on our street,” said retired post-master Upasiri Sumanaratne, 75, a resident of the housing scheme.

“It's our turn to pray for him in his time of trouble.”Far away in the United States, Rajaratnam stands accused of securities fraud and conspiracy to commit securities fraud, charges he intends to fight.

Prosecutors say he and his alleged co-conspirators earned 20 million dollars in

improper gains.

Rajaratnam, 52, is a man of mixed roots and many faces, nowhere more so than in his native land of Sri Lanka, where he has friends, foes and admirers.

Previously little known outside financial circles in New York, where he built up tremendous wealth as the boss of his hedge fund, he has a more public profile in Sri Lanka, his country of birth.

Here, he is revered by some for his midas touch as one of the biggest investors in Sri Lankan companies. He is a generous donor for humanitarian causes.

But among hawks in the government establishment, suspicions linger that he is a sympathiser and funder of the dreaded Liberation Tigers of Tamil Eelam (LTTE), which fought a three-decade battle for independence.

“Raj is an LTTE fund-raiser and an activist in LTTE transactions. We have shared this information over the years with the US authorities,” Sri Lankan Foreign Minister Rohitha Bogollagama told reporters last Thursday.

The sort of charity work carried out in Rathgama has fuelled the allegations of financing terrorism -- strongly denied by Rajaratnam -- in this highly polarised country that has been gripped by war for over 30 years.

Rajaratnam is a member of the Tamil minority in whose name the Tamil Tiger rebels fought a brutal insurgency against government forces for an independent homeland, deploying suicide bombers and child soldiers.

They were finally defeated in May after an onslaught by government forces.

Probes here found that the financier had donated two million dollars to the US-based Tamil Rehabilitation Organisation, which was eventually banned in 2007 by the United States and Sri Lanka for links with the rebels.

But investigators at the central bank, the top authority on financial transactions, concluded the money was given before the ban and was donated “in good faith”.

He and his father were nevertheless named in a civil lawsuit in the United States on behalf of victims of Tamil Tiger violence. His lawyers have rejected the funding allegations and denied any links.

Some here are keen to stress that Rajaratnam's support for charities cuts across ethnic lines.

Ajit Gunawardene, deputy chairman of the John Keells Holdings group, of which Rajaratnam is the second biggest shareholder, with an 8.0 percent equity stake, remembers his reaction to the tsunami disaster in 2004.

“He happened to be here when the tsunami hit us. He was moved by the devastation and gave his own money to build houses,” Gunawardene told AFP.

“His only request was to spread the money in the north, east and south.”Channelled through the John Keells charity arm, the five million dollars Rajaratnam donated was spent to build nearly 400 houses for the island's ethnic groups -- Sinhalese, Tamils and Muslims, he said.

Last month, Sri Lanka's justice ministry thanked Rajaratnam for millions of dollars donated to rehabilitate child soldiers conscripted by the Tigers.

Listed as the world's 559th richest person by Forbes magazine, with a net worth estimated at 1.3 billion dollars, Rajaratnam is also one of the biggest investors in Sri Lanka, capable of moving markets with every decision.

The tiny 10-billion-dollar Colombo Stock Exchange, currently one of the best performing markets in the world, lost two percent of its value on news of his arrest.

“Raj was by far the biggest foreign hedge fund investing in a few publicly quoted and private companies in Sri Lanka,” said Murtaza Jafferjee, chief executive of JB Securities, a private brokerage, who managed Rajaratnam's investments in Sri Lanka until three years ago.

“I'm really shocked and surprised by the charges,” he said.

Rajaratnam grew up in Colombo's elite neighbourhood and studied at a private Christian primary school, Saint Thomas Preparatory College, that overlooks the Indian Ocean.

His father, J. M. Rajaratnam, headed the local unit of sewing multinational Singer Industries and moved the family to Britain and then the United States, where Raj created the hedge fund and went on to make his millions.

Rajaratnam's New York-based Galleon fund firm manages 3.7 billion dollars in investments.

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