A disgraced former Intel executive, whose testimony helped convict the hedge fund billionaire Raj Rajaratnam of insider trading crimes, deserves a lenient sentence because of his cooperation with the government, federal prosecutors said on Friday.
In a letter to Judge Barbara Jones, the United States attorney’s office in Manhattan praised the cooperation of Rajiv Goel, the former Intel executive.
“Goel substantially helped the Government secure a conviction in one the most significant and high-profile insider-trading trials in history,” the letter said. “From the first day of Goel’s cooperation through the present, Goel has been a very important, straightforward, and extraordinarily helpful cooperating witness.”
Goel, 54, is set to be sentenced on Wednesday in Federal District Court in Manhattan. He was one of three main government witnesses who pleaded guilty to conspiring with Rajaratnam in a far-reaching insider trading conspiracy and then testified against him during his trial.
The other two witnesses have already been sentenced and were spared prison time. Anil Kumar, a former McKinsey executive, and Adam Smith, a former trader at Rajaratnam’s hedge fund Galleon Group, were both given probationary sentences because of their extensive cooperation.
Goel met Rajaratnam while the two were business-school students at the Wharton School of the University of Pennsylvania. Rajaratnam lured Goel into his insider trading conspiracy by bestowing favours upon his old friend, including executing profitable — and illegal — trades in Goel’s Charles Schwab brokerage account. Eventually, Goel gave Rajaratnam advance word of Intel’s quarterly earnings results.
“He knew that it was wrong for him to do so and regrets the decision that he made at the time, not only because of the negative consequences that he has justifiably suffered as a result of that decision, but also because of his betrayal of Intel, a company that had vested so much trust in him over the years,” wrote David Zornow, a lawyer for Goel, in his letter to Judge Jones.
At trial, Goel proved an effective witness, walking the jury through secretly recorded telephone calls during which he and Rajaratnam exchanged confidential information about Intel. “During his testimony, Goel was contrite, truthful, and direct about his criminal conduct,” the government’s letter said.
The government’s letter to Judge Jones indicates that Goel has continued to help the government since Rajaratnam’s conviction in May 2011.
Separately, an appeal of Rajaratnam’s conviction has been scheduled to be heard by the Court of Appeals for the Second Circuit on October 25.
It says that as recently as July 30, 2012, Goel spoke with prosecutors to provide information about certain trades in the Galleon case that continue to be investigated.
Zornow, the lawyer for Goel, asked Judge Jones to spare his client a prison term and sentence him to probation. “Mr 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 Mr Goel’s efforts to rebuild his career, and would limit his ability to support those people who depend on him.”
Separately, an appeal of Rajaratnam’s conviction has been scheduled to be heard by the Court of Appeals for the Second Circuit on October 25.
© 2012 The New York Times News Service
