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U.S. Seeks Leniency for Kahn for Aid Against Rajaratnam

Roomy Khan, a former Intel Corp. (INTC) executive at the center of the biggest stock-tipping probe in U.S. history, should get leniency when she’s sentenced this week because she helped the government convict Raj Rajaratnam, Doug Whitman and others, U.S. prosecutors said.

The prosecutors, from the office of U.S. Attorney Preet Bharara in Manhattan, said they are seeking a shortened sentence for Khan despite the fact that she lied, destroyed evidence and tipped off co-conspirators to the government’s investigation when she was working with federal agents and prosecutors.

“Khan’s cooperation with the government, while limited by her failure to be fully truthful and her efforts to protect others, has nonetheless been extremely substantial,” Assistant U.S. Attorneys Christopher LaVigne and Jillian Berman said in a letter to U.S. District Judge Jed S. Rakoff made public Jan. 25.

Khan began working with the government in November 2007. She helped prosecutors win authorization to tap the mobile phone of Galleon Group LLC co-founder Rajaratnam, the prosecutors said. Khan also testified as a government witness in the trial of Whitman, the founder of Whitman Capital Inc., who was convicted in August of conspiracy and securities fraud, they said.

Khan pleaded guilty in October 2009 to conspiracy, securities fraud and obstruction of justice. She’s to be sentenced Jan. 31. The most serious crime carries a 20-year maximum penalty.

The case is U.S. v. Khan, 09-cr-991, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Bob Van Voris in Manhattan federal court at rvanvoris@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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