Victims, Survivors Suing Rajaratnam for Allegedly Financing Terrorist Group

More than 30 people, who say they survived bloody attacks by the Tamil Tiger terrorist group, are now suing New York billionaire Raj Rajaratnam and his father, J.M. Rajaratnam, for allegedly giving millions of dollars to the terrorists operating in their native Sri Lanka. The younger Rajaratnam was indicted last week by a federal grand jury on charges that he orchestrated a massive insider trading scheme.

Attorneys for the victims of the attacks filed the 91-page civil complaint in the U.S. Court for the District of New Jersey Thursday. It asserts that Raj Rajaratnam, a Sri Lankan native, funneled massive amounts of money into the pockets of the Tamil Tigers, also known as the Liberation Tigers of Tamil Eelam (LTTE).

According to the complaint, and as first reported by ABC News.com last week, Rajaratnam personally gave $3.5 million in contributions to the Tamil Rehabilitation Organization (TRO), whose assets were later frozen by the U.S. Treasury Department in Nov. 2007 because of its alleged ties to the Tamil Tigers and the LTTE.

The seven-count complaint alleges that Raj's charitable donations also came from profits generated at the Galleon Group, the New York-based hedge fund he founded in 1997.

Last week, he and five others were indicted for their involvement in what's considered the largest-ever insider trading case involving a hedge fund. According to federal prosecutors, Rajaratnam allegedly used insider information to trade securities in several publicly traded companies and produce more than $25 million in illegal profits, a charge the 52-year-old Rajaratnam denies.

In addition, the complaint alleges that J.M. Rajaratnam also made more than $5 million in charitable contributions to the Tamils Rehabiliation Organization through the Rajaratnam Family Foundation.

The Clinton Administration designated the Tamil Tigers as a terrorist group in 1997. Its leader was killed by Sri Lankan government forces in May and Sri Lankan government officials said U.S. and Canadian-based charities had helped keep the Tamil Tigers running.

"The hope of our clients is that by bringing this lawsuit, it will publically expose the financing the LTTE from the U.S., particularly Raj, his father and the TRO," said Mike Elsner, the lead attorney representing the victims filing the suit, in an interview with ABC News.com. "This lawsuit will act as a warning to other people, who fund terrorist groups, that if they do so they risk civil prosecution in the United States."

An attorney representing Raj Rajaratnam, Jim Walden, sent ABC News this statement:

"The accusation that Mr. Rajaratnam supported the LTTE is flatly untrue and libelous, and we are confident that the Court will dismiss these baseless charges. Mr. Rajaratnam has the greatest sympathy for all victims of violence in Sri Lanka and has a long history of helping Sri Lankans of all ethnic groups through substantial charitable donations over many years."

The plaintiffs are seeking damages to be determined by a jury, but no less than $75,000.

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