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Securities Law

Rajaratnam Calls Requested 20 Years ‘Grotesquely Severe,’ Says Insider Trading Definition Not Clear

Posted Sep 12, 2011 12:47 PM CDT
By Martha Neil

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Interviewed by a probation officer for a presentence investigation report, a hedge fund co-founder recently convicted in the biggest insider-trading case in decades said he still isn't clear on the concept of what is and isn't permitted, reports Bloomberg.

"In my own mind, the line between permissible ‘detective work’ and impermissible insider trading was not always clear, especially with regard to companies broadly covered by the news media as to which there was a wealth of publicly available information, including frequent leaks, rumors and speculation about corporate transactions and other important developments,” Raj Rajaratnam told the officer in the New York case.

Prosecutors, who made the statement public, complained to a federal judge in Manhattan that the 54-year-old's comments showed he had no appreciation of what he did wrong.

Rajaratnam also reportedly called the 19- to 24-year prison term sought by prosecutors "grotesquely severe," contending that the government's requested sentence for him is greater than the average sentences for those who kidnap, take hostages, rob or commit arson.

Earlier coverage:

ABAJournal.com: "Rajaratnam’s Conviction Points Way Toward New Focus on Aggressive, High-Tech Securities Probes"

ABAJournal.com: "The Second Guessing Begins: Was Combative Strategy a Mistake in Rajaratnam Trial?"

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