Former Galleon hedge fund head Raj Rajaratnam was sentenced to 11 years in prison by a federal judge today. He was also levied a $10 million fine.
The sentencing culminates the legal battle against the former executive accused of insider trading. A jury convicted him of securities and fraud last May.
Rajaratnam's sentence is the longest ever for insider trading, The New York Times reports. It's also a boon for federal prosecutors who have been trying to crack down on fraudulent activity on Wall Street.
Though lengthy, Rajaratnam's sentence is actually much lower than what was anticipated. It's half of the 19 to 24 years requested by the government.
But the 11-year sentence is indicative of one thing: it seems white collar crimes are garnering harsher sentences. This might be a new shift considering that courts and judges were traditionally more lenient to sentencing corporate criminals, according to The New York Times.
After all, what seems more egregious to the average person - a financial crime, or a crime of violence like murder? Most would think the murder mandates a longer sentence. But doesn't a financial crime also cause harm?
Of course, there are different types of financial crimes. Ponzi schemes or fraudulent accounting practices can appear to be "worse" than insider trading. It's hard to put a face to who is injured when you use confidential information to trade stock and earn a few bucks. But it's easy to picture the lives that are destroyed when you pocket someone's pension or bankrupt their savings.
Raj Rajaratnam's sentence, however, does send a message to many Wall Street power players. At its peak, Bloomberg reports that Galleon managed $7 billion. And now look how far its former head has fallen.
- Rajaratnam sentenced to 11 years for insider trading (USA Today)
- Raj Rajaratnam Case Will Affect Many Corporations Going Forward (FindLaw's In House)
- Billionaire Raj Rajaratnam Guilty in Insider Trading Case (FindLaw's Decided)
- Rajaratnam Trial: In House Counsel Lessons Abound (FindLaw's In House)