Danielle Chiesi, one of the most memorable figures in the insider trading probe that snared billionaire hedge fund mogul Raj Rajaratnam, has begun her 2 ½ year sentence in federal prison, according to a U.S. Bureau of Prisons website. Chiesi, 45, is now an inmate at the Federal Prison Camp in Alderson, West Virginia. It is the same facility where Martha Stewart served a five month sentence in 2004 for lying to investigators in an insider trading case.
Chiesi, a former trading consultant for a unit of Bear Stearns, pleaded guilty in January to three conspiracy counts for illegally trafficking in inside information with Rajaratnam and others. She was originally slated to go on trial alongside Rajaratnam, who was convicted in May on 14 criminal counts, and last week was sentenced to eleven years in prison.
Speaking to CNBC exclusively ahead of her sentencing in July, Chiesi said even she was surprised at the lengths to which some on Wall Street will go to gain an edge.
“That’s the whole game,” she said. “It’s all about information.”
At Alderson, Chiesi will spend two weeks in orientation, and will endure a battery of educational and psychological tests, before joining a population of around 1,100 female inmates, according to a handbook for the facility.
Alderson is a minimum security facility, with what the Bureau of Prisons describes as “dormitory style” housing. Chiesi, who gained a reputation for wearing what some considered seductive outfits when she was in business, will be required in prison to wear a standard-issue khaki uniform with a belt, work boots, and her shirt tucked in. The handbook notes that electric hair dryers, hot combs and curling irons are available for inmates.
Asked on the day of her sentencing how she was approaching the prospect of prison, Chiesi told CNBC she was “very frightened,” but said she had her “head held up high.”
— Additional reporting by Cat Corrigan