Daylife/Reuters Pictures used by permission

By all appearances, Raj Rajaratnam was a self-made billionaire, having built Galleon Group into a giant hedge fund with a specialty in technology companies.

But prosecutors said on Friday that he had profited not from his trading genius but from his Rolodex, and they arrested him on charges of conspiracy and securities fraud in what they called the biggest insider trading scheme ever involving a hedge fund.

In all, six people were arrested, accused by prosecutors and the Securities and Exchange Commission of earning more than $20 million from illegal trading in companies like Google, Akamai and Hilton Hotels over nearly three years.

Mr. Rajaratnam is accused of tapping a vast network of informants across a swath of corporate America: a senior official at I.B.M. considered a contender for the top job at that firm; executives of Intel and the consulting firm McKinsey & Company; two former Bear Stearns employees who had moved to a hedge fund, New Castle Partners; and an analyst at Moody’s Investors Service.

While trading secrets, though, one crucial piece of information was not shared — several of the phones were tapped.

The wiretaps were made with the help of an unnamed cooperating witness, a former Galleon employee who was said to ply Mr. Rajaratnam with information originally to land a job. The witness, who began cooperating in November 2007, has agreed to plead guilty in the hopes of receiving a lesser sentence.

“This case should serve as a wake-up call for Wall Street,” Preet Bharara, the United States attorney for the Southern District of New York, said at a news conference on Friday. He added that the investigation was continuing.

Wake-up call my Sweet Aunt Josephine’s rosy cheeks! RTFA. It’s like cleaning out the White House and leaving behind a thoroughly corrupt Congress.

The SEC was pressed into dumping a few bad apples like Madoff – and now Rajaratnam – who sit in the midst of a network of corruption and deceit that remains without thoroughgoing regulation or oversight.