Danielle Chiesi had stood shoulder to shoulder with her co-defendant, Raj Rajaratnam, central figures in the Galleon Group hedge fund insider trading case - until Wednesday afternoon, when she pleaded guilty to 3 counts of conspiracy.  She apparently is not cooperating with the government, and prosecutors have not asked for her cooperation. 

Dressed in a black pantsuit with her long platinum-blonde hair tied up in a bun, Ms. Chiesi kissed her mother before taking a seat at the defense table, where she was flanked by her lawyers.

Ms. Chiesi, 45, told Judge Richard Holowell she was changing her plea from not guilty to guilty, and that she was currently under psychiatric care and taking anti-anxiety drugs. 

“This guilty plea causes me great pain and I’m deeply ashamed by what I did.  I ruined a 20-year career that I truly loved and have brought disrepute to my profession."  --Ms. Chiesi. 

After expressing remorse to her family - her sister and 2 teenage nieces, all in the courtroom - Ms. Chiesi began sobbing.  “I apologize to them and the court,” she said, fighting through tears.

    Sentencing.   Sentencing is scheduled for 5/13/11.  Federal prosecutors recommended a prison sentence of 37 to 46 months. Ms. Chies is one of the highest-profile figures to plead guilty in the government’s insider trading investigation, and she's the 16th person to plead guilty - of 25 people charged - to crimes related to the investigation of Raj Rajaratnam, co-founder of hedge fund Galleon Group.

Mr. Rajaratnam, who's fighting the charges, is scheduled for a 2/28/11 trial date.  Ms. Chiesi reportedly has not been asked to testify in that trial.

Ms. Chiesi, who grew up in Binghamton, NY, began her Wall Street career in the late 1980s and after stints at several brokerage firms joined Bear Stearns. There, she worked under Mark Kurland, a stock analyst who eventually recruited her to work with him at New Castle, an equity hedge fund he had set up within Bear Stearns.  Mr. Kurland was among the first defendants to plead guilty in the Galleon case and was sentenced to 27 months in prison.

For further details, refer to:  [NYT Dealbook, 1/19]