Insider trader jail term disappoints US
Source: Agencies |
October 15, 2011, Saturday
|
Print Edition
Print Edition
THE 11-year prison sentence for a wealthy hedge fund founder convicted of insider trading has set a record but left the US government well short of the more than 20 years it sought to send a stern message to Wall Street.
In a New York court on Thursday, Raj Rajaratnam, 54, heard Judge Richard Holwell announce a sentence four years below a Probation Department recommendation and well short of the government's request that the Galleon Group founder serve more than 24 years.
Holwell credited Rajaratnam for acts of charity and cited his diabetes and need for a kidney transplant as reasons for leniency.
Robert Mintz, a former federal prosecutor who heads the white-collar defense group at law firm McCarter & English, said: "Given the role Rajaratnam played in this scheme, many people could criticize the sentence as being too lenient.
"In this environment where there is a palpable public antipathy to Wall Street, many people expected a sentence that was going to be closer to what prosecutors were seeking."
Assistant US Attorney Reed Brodsky said Rajaratnam made up to US$75 million between 2003 and 2009 at his group of funds by working a network of friends, former classmates and other tipsters at companies and investment firms to obtain lucrative secrets about public companies, including Google, IBM, Hilton Hotels and Goldman Sachs.
He said insider trading - carried out by smart, educated people - had "become rampant" because the incentives to commit it were higher than ever and detecting it was difficult.
"They know they are committing crimes, but it's OK because they need to beat the competition. It's OK because they need to achieve the best. It's OK because is it really so bad? That was Rajaratnam's attitude," Brodsky said.
Holwell also imposed a US$10 million fine and ordered forfeiture of US$53.8 million, representing illicit profits.
In 2009, Rajaratnam was ranked by Forbes magazine 559th in a list of the world's wealthiest billionaires, with a US$1.3 billion net worth.
In a New York court on Thursday, Raj Rajaratnam, 54, heard Judge Richard Holwell announce a sentence four years below a Probation Department recommendation and well short of the government's request that the Galleon Group founder serve more than 24 years.
Holwell credited Rajaratnam for acts of charity and cited his diabetes and need for a kidney transplant as reasons for leniency.
Robert Mintz, a former federal prosecutor who heads the white-collar defense group at law firm McCarter & English, said: "Given the role Rajaratnam played in this scheme, many people could criticize the sentence as being too lenient.
"In this environment where there is a palpable public antipathy to Wall Street, many people expected a sentence that was going to be closer to what prosecutors were seeking."
Assistant US Attorney Reed Brodsky said Rajaratnam made up to US$75 million between 2003 and 2009 at his group of funds by working a network of friends, former classmates and other tipsters at companies and investment firms to obtain lucrative secrets about public companies, including Google, IBM, Hilton Hotels and Goldman Sachs.
He said insider trading - carried out by smart, educated people - had "become rampant" because the incentives to commit it were higher than ever and detecting it was difficult.
"They know they are committing crimes, but it's OK because they need to beat the competition. It's OK because they need to achieve the best. It's OK because is it really so bad? That was Rajaratnam's attitude," Brodsky said.
Holwell also imposed a US$10 million fine and ordered forfeiture of US$53.8 million, representing illicit profits.
In 2009, Rajaratnam was ranked by Forbes magazine 559th in a list of the world's wealthiest billionaires, with a US$1.3 billion net worth.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
