[ by Melanie Gretchen and Howard Haykin ]

Perhaps if this was a T.V. program, Raj Rajaratnam might call his younger brother, Rengan Rajaratnam, a "meathead."  That's because Rengan is the apparent contrarian in the family.  Rengan is talking with federal prosecutors about a possible plea deal in settlement of insider trading charges.

Raj, his older (and wiser????) brother - the hedge fund billionaire and convicted insider trader - pleaded "not guilty" but later was convicted by jury of trading on insider information and was sentenced to 11 years in prison;  he also was ordered to pay $150 million in civil penalties. 

The Brothers Did Not Always Differ.   Rengan Rajaratnam, 42, was a portfolio manager at his brother's NY-based hedge fund firm at the time he allegedly traded on insider information - in Intel, Advanced Micro Devices and Clearwire securities, among others. 

Rengan first notion was to plead 'not guilty' to the government's 7-count federal indictment filed earlier this year.  That was until the tide apparently turned in favor of the the prosecution.  A 5/30 letter to the courts by made public by Assistant U.S. Attorney David Massey noted that plea negotiations began shortly after Rengan Rajaratnam's arraignment in March.  In that letter, Mr. Massey mentioned:  "In order to facilitate plea discussions with the defense, the government provided a binder of key wiretap transcripts, summaries of trading records and other significant evidence to the defense."

Talks appear to have reached a serious level, prompting U.S. District Judge Naomi Reice Buchwald to delay a hearing that had been scheduled for Tuesday.  Rengen Rajaratnam is next scheduled to appear in court on 7/30.  Meanwhile, brother Raj awaits the courts decision on the appeal of his 2011 conviction.

For further details, go to [CNBC, 6/3/13] and [Hindustan Times, 6/4/13].