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August 26, 2011

Feds seeking (within-guideline) sentence of 70-80 months for high-profile insider trader

As detailed in this Bloomberg piece, "Craig Drimal, the former Galleon Group LLC trader who pleaded guilty to insider-trading charges, should get a prison term of 70 to 80 months, which is within federal sentencing guidelines, the U.S. said in a court filing."  Here is more about this high-profile white-collar case, which is scheduled for sentencing next week:

Drimal, 55, pleaded guilty in April in federal court in New York charges of conspiracy and securities fraud. Drimal admitted that he and others at Galleon traded on inside information obtained from lawyers working on transactions involving 3Com Corp. and Axcan Pharma Inc. in 2007.  Drimal said the information was obtained from Arthur Cutillo and Brien Santarlas, lawyers at Boston-based Ropes & Gray LLP.

Drimal has suggested that the court impose community service or home confinement in lieu of a “substantial” prison term, prosecutors said.  The request should be denied in order to send a “strong message of deterrence to others in the hedge fund community” and because the “nature and extent of his criminal conduct doesn’t warrant community service,” prosecutors said.

“Drimal has no excuse for his illegal conduct,” prosecutors said in the sentencing memo, which was filed yesterday.  “He grew up in a stable, loving family with no financial difficulties.  He is a college graduate.  He has a loving and supportive family.  He fully understood that insider trading was illegal and yet repeatedly disregarded the law to make a lot of money.”...

Drimal’s attorney, Jane Anne Murray, said she filed a memorandum last week asking the judge impose a sentence below the federal guidelines. “We’re not surprised by their position; it’s been consistent,” Murray said in a phone interview.  “We disagree with the government on a number of issues including the applicable guidelines.  And we’re seeking a sentence that is substantially lower than the one the government is seeking.”

August 26, 2011 at 10:51 AM | Permalink

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