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Hedge Fund Boss Gets 11 Years in Insider Trading Probe

Thursday, October 13, 2011

A billionaire convicted in the biggest insider trading case involving hedge funds in the U.S. was sentenced to 11 years in prison Thursday, five months after he was convicted by a federal jury in a Manhattan courtroom.

Raj Rajaratnam, 53, and founder of one of the biggest hedge funds in the U.S, was also fined $10 million.

"His crimes and the scope of his crimes reflect a virus in our business culture that needs to be eradicated," U.S. District Judge Richard J. Holwell said.

The judge said Rajaratnam needs a kidney transplant and has advanced diabetes and took his charity work into consideration in giving him leniency.

Rajaratnam was found guilty in May of 14 counts of securities fraud and conspiracy, committed while he ran the Galleon Group.

Prosecutors said he was the central figure in a vast insider trading network and made an estimated $63.8 million in illegal profits.

The case against the financier relied on wiretapped conversations recorded by federal agents over the course of nine months.

Wherever possible, Rajaratnam's team tried to raise doubts about the tapes, discredit witnesses and highlight Galleon's legitimate trading and research. He never took the stand in his own defense.

Rajaratnam could spend as many as 25 years in prison. Since his conviction, he's been in home detention, on $100 million bail.

More than two dozen others have already been convicted in related cases.

Before he was arrested in October 2009, Rajaratnam earned a spot on Forbes' list of the richest Americans (No. 262), with net worth estimated at $1.8 billion.

With the Associated Press

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Comments [7]

larkforsure from Shanghai, China

[ SOS ] Complaint about Human Rights Violations by IBM China on Centennial

Please Google:

Tragedy of Labor Rights Repression in IBM China
or
How Much IBM Can Get Away with is the Responsibility of the Media
or
IBM detained mother of ex-employee on the day of centennial

Oct. 15 2011 12:41 PM
roz

I wonder if he will get in shape in prison. He looks super well fed and very under exercised. He could get in amazing shape in 11 years. Just saying...

Oct. 13 2011 06:00 PM

clive betters

he aint no scape goat. he is a crook. and i believe he is asian. either indian or pakistani.

Oct. 13 2011 05:06 PM

bemused from nyc

they did. his name is bernie madoff.

Oct. 13 2011 05:05 PM
clive betters

oh gee, another madoff, scapegoat smokescreen job. and, a black scape goat, no less. meantime,what about the bank and wall st reform. that's what we really need !!

Oct. 13 2011 01:50 PM

He has 1.8 billion and he was fined only 10 million? Gee, bet that drop in the bucket really hurt...

Oct. 13 2011 01:48 PM
bemused from nyc

I'll pay attention when they handcuff a white guy and ship him off to federal prison. Plenty to choose from.

Oct. 13 2011 09:58 AM

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