Ex-US prison counselor admits accepting bribe from Galleon's Rajaratnam

FILE PHOTO: Galleon hedge fund founder Raj Rajaratnam arrives at Manhattan Federal Court in New York

By Nate Raymond

BOSTON (Reuters) - A former correctional counselor at a federal prison in Massachusetts pleaded guilty on Wednesday to secretly accepting tens of thousands of dollars from a wealthy inmate identified by a source as Galleon Group hedge fund founder Raj Rajaratnam.

William Tidwell, 49, did not mention Rajaratnam by name when appearing before a judge in Boston to admit to accepting about $90,000 in exchange for giving favorable treatment to a wealthy inmate at the Federal Medical Center Devens in Ayer, Massachusetts.

But a person familiar with the matter has previously said the inmate was Rajaratnam, who was convicted and sentenced in 2011 to 11 years in prison for insider trading and was released early in 2019.

Prosecutors have said Rajaratnam, the founder of the New York-based Galleon Group, made as much as $63.8 million in illicit profit from 2003 to 2009 trading on stocks including eBay, Goldman Sachs and Google.

No charges have been filed against Rajaratnam in relation to Tidwell. Rajaratnam's lawyer, Samidh Guha, has said he would "cooperate appropriately with the government if and when they reach out to us." Guha did not respond to a request for comment.

Tidwell pleaded guilty to receiving a bribe, making false statements to a bank and identity theft. In court, he said he was admitting wrongdoing to "put it behind me."

Under a plea deal, prosecutors plan to recommend that U.S. District Judge William Young sentence him to no more than two years in prison on Dec. 7.

During Wednesday's hearing, Assistant U.S. Attorney Kunal Pasricha said Tidwell starting in 2018 received a stream of financial benefits from an "ultra-high net worth" inmate and one of his close friends.

Those benefits included $25,000 to help pay off loans for a family member and more than $65,000 in fees and other benefits to help manage certain properties, including one Tidwell lived at, according to charging documents.

Later, after the inmate's release from prison, Tidwell in 2020 received a $50,000 loan from the ex-inmate's friend to buy a house. Prosecutors said he lied on a bank loan application about the source of that money.

(Reporting by Nate Raymond in Boston; editing by Grant McCool)