Anil Kumar,a former director at McKinsey & Company accused of leaking information to Raj Rajaratnam in the Galleon Group insider trading case,pleaded guilty on Thursday afternoon and agreed to cooperate with prosecutors in the widening investigation. Kumar,51,pleaded guilty to one count of securities fraud and one count of conspiracy to commit securities fraud in Federal District Court in Manhattan. Choking up and tearing,he said he apologizes to his colleagues for the shame they have suffered. Kumar said that from 2004 through 2009 he was paid by Rajaratnam to provide him with inside information about the companies he was working for. Kumar,a friend of Rajaratnam and a direct investor in a hedge fund controlled by the Galleon Group,is the seventh person charged in the insider trading case to reach a plea agreement with prosecutors. He faces a maximum of 25 years in prison,but will likely receive much less after agreeing to cooperate. Kumar said Rajaratnam offered to pay him $500,000 a year for confidential information about certain clients he was working for. In order to hide the cash payments,Kumar admitted that Rajaratnam opened a Swiss bank account for him under a different name and then funneled the payments to the account,and eventually into Galleons hedge funds.
