Reuters - Video

Edition: US | UK | IN | CN | JP

video Top News

11 years for Rajaratnam

Thursday, October 13, 2011 - 02:09

Oct. 13 - Former hedge fund tycoon Raj Rajaratnam was sentenced to 11 years in prison, the longest sentence ever for insider trading. Bobbi Rebell reports.

▲ Hide Transcript

View Transcript

Raj Rajaratnam, the man prosecutors have called the modern face of insider trading, arrived in court for his sentencing Thursday morning. The self-made hedge fund tycoon, who was convicted in the biggest Wall Street trading scandal in a generation, was ordered to serve 11 years in prison. While it was one of the longest sentences ever in an insider-trading case, it was far less than the maximum of almost 25 years. White collar defense attorney David Siegal of Haynes and Boone has been following this historic case: SOUNDBITE: DAVID SIEGAL, PARTNER, HAYNES AND BOONE (ENGLISH) SAYING: "Most insider trading cases are opportunistic crimes: somebody has a cousin or a friend who works at a publicly traded company and they just by happenstance come upon some information and then make a trade that is out of the ordinary for them. In this case based on the government's evidence, Mr. Rajaratnam had an industry, essentially, of mining insider tips from major companies in the executive suites all across the U.S. and made it a fairly regular practice and a method of padding his company's profits regularly." The 54-year old Rajaratnam was convicted on May 11th of nine counts of securities fraud and five of conspiracy. Thursday the judge also fined him $10 million dollars and ordered Rajaratnam to forfeit almost $54 million dollars- in addition to the prison term. SOUNDBITE: DAVID SIEGAL, PARTNER, HAYNES AND BOONE (ENGLISH) SAYING: "I do not think we've seen the end of insider trading. Greed is a motive that propels people to do stupid, unwise things all the time and that's been the case for the entire history of humanity. But a sentence like this certainly creates a different calculus in somebody's mind whether the cost benefit analysis makes sense to do it. So there's definitely a law enforcement benefit to this kind of a sentence." Rajaratnam was denied his request to remain on house arrest while he appeals the case, but was allowed to return home until he reports to prison on November 28th. Bobbi Rebell, Reuters.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

11 years for Rajaratnam

Thursday, October 13, 2011 - 02:09