A former vice president of California chipmaker Atheros Communications was sentenced Monday to 18 months in prison for his role in what authorities have called the biggest hedge fund insider trading case in history.

U.S. District Judge Richard J. Holwell announced the sentence after Ali Hariri declined to say anything on his own behalf. The sentence was less than the two-year term recommended by federal sentencing guidelines.

Still, Holwell said a prison term was necessary, citing "the risk to a fair marketplace of this type of behavior."

The judge added: "The harm is a harm to the system."

In September, former IBM executive Robert Moffat was sentenced to six months in jail for his role in the scandal. He was scheduled to begin the sentence this month.

Moffat, once thought to be a leading candidate to become chief executive officer at IBM (NYSE: IBM), pleaded guilty to providing information in a hedge fund insider trading scheme.

A former Triangle resident, Moffat was an advisor to the board of directors at Lenovo, which bought IBM’s PC division in 2005, until the scandal broke. Moffat led the PC group before it was sold.

Moffat said he gave information to Danielle Chiesi, who still faces trial in what has been labeled the largest hedge fund insider trading case to date.

Hariri, 39, pleaded guilty in March to securities fraud and conspiracy to commit securities fraud. He was among 21 people arrested in the case a year ago. Already, a dozen people have pleaded guilty to charges.

The San Francisco resident admitted feeding inside information about the wireless communications company where he worked to a friend employed at a hedge fund.

When the charges were announced a year ago, prosecutors staged a news conference, saying they had used wiretaps extensively to record the defendants sharing tips that enabled them to make more than $50 million in profits.

Central to the scheme was Raj Rajaratnam, the founder of the Galleon Group and one of America’s richest men, prosecutors said.

Rajaratnam, who is free on $100 million bail while he awaits trial, has contested the charges, saying through lawyers that he only received information about companies that was already public and based any trades on publicly available information.

In court papers, lawyers for Hariri wrote that Hariri had provided inside information about Atheros to a longtime friend and trusted mentor who without Hariri’s knowledge used it to place trades for his hedge fund.

"Although Mr. Hariri did not profit directly from these trades, he has suffered irreparable harm to his reputation, and he will never again work as an executive in a technology firm," the lawyers wrote as they asked that Hariri spend less than two years in prison.

The lawyers noted Hariri’s success after his family left Tehran, Iran, with only $1,200 after Iraq invaded Iran in 1980.

Hariri eventually moved to Connecticut, where he earned bachelor’s and master’s degrees in electrical engineering from the University of Connecticut.

Hariri said in a letter to the court that he was "truly sorry for what I did and I will regret it for the rest of my life."

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