Rajaratnam Sentenced

Raj Rajaratnam received an 11 year sentence, something that the WSJ describes as the longest ever in an insider trading case.  It was much shorter than what the government had been seeking.  He was also required to pay a $10 million fine and to forfeit $53.8 million.

Sentences in insider trading cases are getting longer.  Rajaratnam's sentence may have been at least in part designed to send a message to those who opt to go to trial rather than accept a plea.  At the same time, however, one has to wonder whether the government would have offered a plea that would have entailed a sentence of much less than the eleven years.  In other words, the risk taken by Rajaratnam in going to trial, although ultimately unsuccessful, may have been a good one.

For the sentencing memos in the case, go to the DU Corporate Governance web site.