14th October 2011
Raj Rajaratnam, the former boss of the Galleon hedge fund, has also been fined $10m. Thirteen other defendants have been jailed as well for an average of three years, although prosecutors were seeking a 25 year sentence for Raja.
Twenty six others have been charged in Galleon-related cases in total with Rajaratnam and three others were convicted at trial, 21 pleading guilty and one defendant at large.
Rajaratnam's sentencing follows a 10-year sentence for Zvi Goffer, a former trader at Galleon.
But it is this lawyer's comment from the Guardian that may be of interest in the UK. Simon Hart, partner at law firm Reed Smith, told the paper: "Rajaratnam's conviction was in large part secured through the use of phone-tap evidence. That is simply not an avenue available to the FSA when investigating and prosecuting insider dealing. Furthermore, even if there was a successful prosecution of this nature, the sentencing precedents in the UK don't come anywhere near the magnitude of those we have seen in the US."
The US certainly has a longer history of quite spectacular prosecutions as Time magazine reports here though first it gives a handy Kindergarden definition of the practice.