September 13, 2012 1:19:00 am
Intel Corp’s former India-born managing director Rajiv Goel,who had pleaded guilty to passing confidential information about the firm to now-jailed hedge fund founder Raj Rajaratnam,will be sentenced next week on insider trading charges and could face 25 years in prison.
Goel,54,was arrested with Rajaratnam in October 2009 and had pleaded guilty in 2010 to conspiracy and securities fraud.
He is scheduled to be sentenced on September 21 before Judge Barbara Jones in Manhattan federal court.
The Wharton Business School graduate was among the scores of Wall Street executives nailed by US Attorney in Manhattan Preet Bharara’s team in the widespread crackdown on insider trading.
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Other prominent India-born executives were also charged by Bharara in the large scale insider trading ring that was managed by Rajaratnam.
Among them,Goldman Sach’s former director Rajat Gupta is the most high profile Indian-American to be convicted on insider trading charges and will be sentenced on October 17.
Goel is one of three main government witnesses who had agreed to cooperate with the government and had testified against the Sri Lankan billionaire in his trial last year.
The other government witness India-born former McKinsey executive Anil Kumar was spared jail time and was sentenced in July to only two years’ probation for his cooperation in Rajaratnam’s and his mentor at Mckinsey Rajat Gupta’s trial.
Federal prosecutors have recommended to the Manhattan Court that Goel be shown leniency at his sentencing since he had provided “substantial assistance” as a key government witness in Rajaratnam’s insider trading trial that helped convict the hedge fund founder.
Earlier this week,Bharara said in a letter to Jones that Goel was a “highly significant witness” who helped the government secure a conviction in one of the most significant and high-profile insider trading trials in history.
Mumbai-born Goel had met Rajaratnam in 1983 at the Wharton Business School.
Goel had served as managing director in Intel¿s treasury department and had provided confidential information to Rajaratnam about the company’s earnings and a billion dollar transaction in 2008.
Rajaratnam made over two million dollars in illegal profits based on the tips.
Goel had told prosecutors he repeatedly sought financial assistance from Rajaratnam,who loaned him USD 100,000 to buy a home in 2005 and another USD 500,000 the next year for his ailing father.
Goel’s lawyer David Zornow also wrote a letter to Jones saying his client should be spared prison term and sentenced only to probation as Goel does not have any previous criminal history and “had lived a life free of crime until he started providing Rajaratnam with inside information.”
“Goel has already paid a hefty price for his involvement with Rajaratnam,in terms of his career prospects and his personal finances,not to mention the toll that the case has exacted on his family,” said Zornow.
“Any sentence of incarceration would delay Goel¿s efforts to rebuild his career,and would limit his ability to support those people who depend on him.”
Zornow said Goel has been unable to find a job since he was arrested in 2009 on insider trading charges.
Goel is also willing to pay more than USD 254,000 to the US Securities and Exchange Commission to settle a civil suit.
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