Trader blows $12m, faces 20 years behind bars

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Krishnan Rasaratnam, former director of Strategic Alternative Investments (SAI), pled guilty late last month to six separate charges of dishonest conduct and deception, and could spend the next twenty years in jail.

Rasaratnam fronted Sydney's Downing Centre Court and pleaded guilty to one count of using a false instrument and five counts of dishonest conduct in relation to providing a financial service.

Prior to the offences, SAI provided product advice, and dealt in derivative and foreign exchange contracts. 

In 2006, ASIC stripped SAI of its Australian financial services (AFS) licence but despite this, Rasaratnam sought funds from investors between 2006 and 2008 by falsely claiming that SAI investments were low risk, high return and were capital guaranteed by a major investment bank.

Rasaratnam then placed those funds into his personal trading account, and actively incurred losses of more than $12 million.

He was arrested and charged in September 2009. His sentencing is scheduled for 29 March 2012.

In sentencing Rasaratnam, the Director of Public Prosecutions will take into account one charge of using a false instrument, three charges of dishonest conduct and two charges of making false statements to ASIC, 

The maximum penalties for the offences total 20 years imprisonment.

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