Mark Zaino, a former UBS AG employee who cooperated with investigators and testified about bid-rigging in the $3.7 trillion municipal bond market, was given no prison time at his sentencing.
Zaino, 39, called a “snake” by defense lawyers in one trial in which he testified as a prosecution witness, was sentenced to the part of a day he spent in custody when he was arrested. Zaino’s lawyer, Deborah Schwartz, said he had been cooperating in the government’s investigation for eight years.
“You deserve to be commended for everything you’ve done,” U.S. District Judge Kimba Wood in Manhattan told Zaino today. She imposed no fine, probation or restitution order. The most serious charge, wire fraud, has a maximum penalty of 20 years.
Zaino, who worked on the Zurich-based bank’s U.S. municipal bonds and derivative trading desk from 2001 to 2006, pleaded guilty in 2010 to fraud and conspiracy charges. He admitted participating in a scheme to rig bids and overcharge state and municipal governments in auctions for bond investment deals.
Zaino testified in the trial of three former General Electric Co. bankers, Dominick Carollo, Steven Goldberg and Peter Grimm. The three were found guilty in May 2012 of conspiracy to commit fraud. A federal appeals court reversed the convictions in December, ruling the government waited too long to file charges against them.
In another trial, Zaino testified against three former UBS employees, Peter Ghavami, Gary Heinz and Michael Welty, who were found guilty of conspiracy in August 2012. The convictions are being appealed. Defense lawyers called Zaino a “snake” in opening statements in an effort to persuade jurors to disregard his testimony.
“I live every day in regret and remorse,” Zaino told Wood in today’s hearing.
The case is U.S. v. Zaino, 10-cr-00434, U.S. District Court, Southern District of New York (Manhattan).