Danielle Chiesi, former hedge fund trader, agreed to settle insider trading charges stemming from her involvement with onetime co-defendant Raj Rajaratnam, founder of the Galleon Group.  In exchange for pleading guilty to 3 conspiracy counts, Ms. Chiesi:  (i) will pay $540K to settle SEC civil charges, (ii) will be disgorged of $500K in illicit gains;  (iii) will pay $40K in interest. U.S. District Judge Jed Rakoff in Manhattan approved the settlement. 

At her plea hearing, Chiesi, 45, tearfully admitted to "crossing the line" by leaking tips about such companies as Advanced Micro Devices and IBM.  These conversations between her and Rajaratnam had been recorded and were played at Rajaratnam's criminal trial.

Prosecutors are seeking a 37-to-46-month prison term for Chiesi, saying she illegally exploited her Wall Street connections and took "active steps" to avoid getting caught.  Chiesi's lawyer has asked for leniency, citing the emotional impact of the "toxic relationships" that his client has had with men like Mark Kurland, her boss at New Castle Funds and lover for nearly 20 years.  Chiesi is scheduled to be sentenced on 7/20 by U.S. District Judge Richard Holwell. Rajaratnam faces sentencing by the same judge on 9/27.

For further details, go to:   [Reuters, 7/13/11]