Galleon, the hedge fund at the centre of insider trading allegations involving its founder and president Raj Rajaratnam, is winding down its funds.

Mr Rajaratnam, who was last week accused of insider trading, told clients in a letter sent on Wednesday morning that it was in the â??best interestâ?� of investors and employees to conduct an â?�orderly wind downâ?� of Galleonâ??s funds while exploring â?�various alternativesâ?� for the business.

The hedge fund manager is among six people, including former Bear Stearns executives, and an executive at IBM, charged in an alleged insider trading scam that prosecutors claim reaped more than $20m in profits.

Following the charges announced on Friday, investors started to put in requests for redemptions from Galleonâ??s funds. In the last few days, brokers to the hedge fund reported that it was rapidly liquidating its investments in anticipation of a wave of investor withdrawals.