Convicted hedge-fund titan Raj Rajaratnam will likely appeal the record penalty handed down by the Securities and Exchange Commission last week on civil insider trading charges, FOX Business Network has learned.  

The penalty, imposed by Federal Judge Jed S. Rakoff, ordered Rajaratnam to pay the SEC a $92.8 million penalty, the largest ever levied in an insider trading case brought by the commission.

The Rajaratnam defense team will likely argue the amount is onerous based on its client’s actual net worth, which is far lower than the billionaire status reported in various media reports.

“Raj is worth nowhere close to $1 billion,” said one person with direct knowledge of the matter. “This will significantly impact him.”

According to people close to Rajaratnam, much of his  net worth was tied up in the now defunct Galleon Group hedge fund, which was disbanded in October 2009. That’s when Rajaratnam was arrested on criminal insider trading charges by the US Attorney’s office and the SEC filed civil charges against he and the firm.

Rajaratnam was eventually convicted on 14 counts of securities fraud and will soon begin serving an 11-year sentence.

Before its downfall, Galleon Group was one of the largest hedge funds on Wall Street, reportedly managing more than $7 billion.

To date, Rajaratnam has paid fines and forfeitures to the government that total more than $150 million -- among the largest ever paid by a white-collar criminal.  

Judge Richard J. Howell, who presided in the federal criminal case, said Rajaratnam made more than $50 million from his illegal trades, a figure his defense team has refuted, arguing the number is closer to $10 million to $15 million.

Moreover, people close to Rajaratnam complain the government based the fines on inaccurate media accounts of his wealth.  

An SEC spokesman had no immediate comment.  

Legal experts are dubious that Rajaratnam will be able to reduce the SEC penalty. 

“There’s a slim chance of winning an appeal to lower that amount,” said one attorney who asked not to be named.