Raj Rajaratnam jailed for 11 years for insider trading

Rajaratnam has been under house arrest in his Manhattan residence

A former hedge-fund manager has been sentenced to 11 years in jail in New York for one of the biggest insider trading cases in American history.

Raj Rajaratnam, 54, has also been fined $10m (£6.4m).

The Galleon Group founder, who was convicted in May 2011, made well over $50m from illegal trades, said the judge at the Manhattan federal court.

The prosecution had requested nearly 20 years in prison, but the defence asked for nine years at most.

Poor health
District Judge Richard Holwell told the court the defendant's "crimes and the scope of his crimes reflect a virus in our business culture that needs to be eradicated".

But the judge also praised "the defendant's responsiveness to and care for the less privileged".

He noted Rajaratnam's efforts to help victims of the earthquake in Pakistan and the 9/11 attacks.

The judge also told the court Rajaratnam has advanced diabetes and needs a kidney transplant.

He said this had been taken into consideration in the sentencing.

More than two dozen people have been convicted in the case, with sentences ranging from a few months to 10 years.

In their pre-sentencing arguments, prosecutors said Rajaratnam "remains defiant that he never committed insider trading and, incredibly, he maintains that the line between legal and illegal conduct was not always clear to him".

The prosecution had said Sri Lankan-born Rajaratnam made up to $75m in profits from illegal trades.

But the defence said he made a much lower sum - about $7m, when trades by his Galleon Group of hedge funds were discounted.

Before the sentencing, the prosecution urged the judge to revoke Rajaratnam's $100m bail and require that he report to prison within three weeks.

He has been under house arrest and wearing an electronic tag in his Manhattan residence.

Among those also convicted in the Galleon case was Bear Stearns hedge-fund trader Danielle Chiesi, a former beauty queen.

Prosecutors said the 45-year-old, sentenced to two-and-a-half years in jail in July, used her feminine charms to elicit illegal information from male executives.