Chiesi Blames Affair For Insider-Trading, Seeks Reduced Sentence

Jun 14 2011 | 1:32pm ET

Danielle Chiesi once pledged that she'd never spend a day in jail. Now, the former New Castle Partners executive would happily settle for anything under two years in the clink.

Lawyers for Chiesi, who pleaded guilty to insider-trading in January, asked that she receive a shorter sentence than her former boss and lover, Mark Kurland, who was sentenced to 27 months last year. Prosecutors have countered that Chiesi should get up to 46 months on the three counts of conspiracy.

"The dozens of recorded conversations between Ms. Chiesi and Mr. Kurland are replete with examples of Kurland encouraging her to get information, of Kurland belittling her ability to analyze financial data, or Kurland being the New Castle decisionmaker regarding investment decisions," lawyer Alan Kaufman wrote.

"We think it is self-evident—and can only hope that the court agrees—that the punishment due for the conduct at issue here should be mitigated once it is recognized as the manifestation of the psychological and emotional forces impacting on Danielle Chiesi, rather than the result of greed and venality," he continued.

Chiesi's boyfried, identified only as Billy, further accused Kurland of engaging in a "vicious cycle of abuse" and "psychological exploitation" to make Chiesi his "virtual servant."

Chiesi was originally to be the co-defendant of Galleon Group founder Raj Rajaratnam. While she did not take the stand in that trial, her flirtatious phone calls with Rajaratnam were played for the jury, which convicted the former billionaire last month.

Chiesi is set to be sentenced on June 30.


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