Galleon Group is winding down all its hedge funds just days after insider trading allegations against billionaire Raj Rajaratnam, its founder and president, sparked a wave of investor withdrawals.

Mr Rajaratnam told clients in a letter on Wednesday that it was in their “best interest” to conduct an ”orderly wind down” of Galleon’s funds while exploring ”various alternatives” for the business. Potential buyers have approached the group, according to a source familiar with the situation.