Tuesday, 29 July 2014
Last updated 7 hours ago
Jul 20 2012 | 2:14am ET
Anil Kumar could have spent more than two decades behind bars. But instead of joining his old friend Raj Rajaratnam, who earned an 11-year sentence thanks in part to Kumar's testimony against him, the former McKinsey & Co. partner won't spend a day in jail.
Kumar, who also testified against former McKinsey chief Rajat Gupta at a trial that resulted in Gupta's conviction on insider-trading charges, was sentenced to just two years probation. He is the latest person caught up in the government's massive insider-trading round-up to profit so handsomely for his cooperation, which prosecutors called extraordinary.
And the judge who handed down the no-jail sentence echoed that sentiment.
"There is the factor of extraordinary cooperation," U.S. Circuit Judge Denny Chin said. "For some reason, in narcotics cases, the culture is the first one to cooperate, everyone wants to cooperate, everyone wants to get in. But, the culture is different in insider-trading cases and perhaps that will change."
But in ruling that "the ends of justice" would not be "served by a period of incarceration," Chin said that he did not believe Kumar turned coat to save his own skin.
"I am persuaded he cooperated not to get a lighter sentence, but to make amends for what he did."
What he did was pass confidential information to Rajaratnam from 2004 until 2009. Kumar pleaded guilty in 2010.
In addition to probation, Chin assessed a $25,000 fine against Kumar and ordered him to forfeit $2.26 million.
For his part, Kumar said he was "completely and totally shamed" by his crimes, noting that he has "become a pariah in [the business] world and am followed by rumors and whispers."
"I only implore the court to be merciful," he said.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…