Hedge-Fund Boss Gets 11 Years

Raj Rajaratnam, former head of the Galleon Group hedge funds, leaves Federal Court in New York after the third day of his insider trading trial Thursday, March 10, 2011. Credit: David Karp / AP Photo

Former hedge-fund tycoon Raj Rajaratnam has been sentenced to 11 years in prison and fined $10 million for insider trading, less than half the time prosecutors requested but still the longest-ever such sentence. Rajaratnam, the founder of Galleon Group, got tips from a network of insiders in Goldman Sachs, Google, Intel, and other companies. Prosecutors say he made $72 million from insider trading, while Rajaratnam’s lawyers say it was only $7.4 million. He was charged along with 25 other people in one of the largest insider-trading schemes in U.S. history. Prosecutors originally sought a sentence of up to 24 years, but the judge granted him a more lenient sentence due to imminent health problems, including kidney failure. Rajaratnam may have white-collar company in prison: he will likely serve time at the Butner Federal Correction Complex, where Bernie Madoff is currently imprisoned.