Legal Status

NEW YORK, October 9, 2011 (AFP) – Raj Rajaratnam, convicted in the biggest US insider trading case for years, faces a sentence of up to 24 years prison next week at the close of a case seen as making an example of the hedge fund tycoon. The sentencing hearing on October 13 before federal Judge Richard Holwell in New York will be closely watched for the message it sends to Wall Street.

Sri Lankan-born Rajaratnam, 54, was convicted in May on 14 counts of conspiracy and securities fraud related to his use of illegal insider tips for an edge on multi-million dollar stock market trades.

The trial grabbed attention because it exposed deeply hidden corruption on Wall Street and also because of the ruthlessness of prosecutors who took the unusual step for a white collar probe of using telephone wiretaps to gather evidence.

According to prosecutors, the brilliant founder of the Galleon Group hedge fund netted about $72 million on the basis of those tips, which included deals on shares in Goldman Sachs, Intel Corp, and Google Inc. In final pre-sentencing arguments on Tuesday, prosecutors demanded Rajaratnam be sentenced to as much as 293 months, or about 24-1/2 years, in prison, and a minimum of 19.5 years.

They told Holwell th