A jury of Raj Rajaratnam's peers (except when it comes to wealth) has found him guilty of 14 counts of fraud and conspiracy, after deliberating 12 days. Rajaratnam, now a part of the pantheon of Wall Street rogues, faces many years in prison at his sentencing, which is set for July 29.

Prosecutors asked that Rajaratnam immediately be put back in jail, arguing that he was now a flight risk. But the judge showed mercy and allowed him to remain free on $100 million bail, as long as he wore an electronic bracelet for monitoring purposes.

You have to wonder if the decision not to put Rajaratnam on the stand was a good one. My sense is that it wouldn't have made much of a difference, unless the defendant oozed honesty and sincerity. If Rajaratnam came off like a smug Fat Cat, he would have dug himself in deeper.

Rajaratnam's lawyers have already said they will appeal, as we all expected, and will surely raise issues with the wiretaps that were central to the government's case.

For now, the government--and specifically Preet Bharara, the Manhattan U.S. Attorney who is undertaking an aggressive crackdown on a practice he thinks is rampant--can celebrate a watershed victory. The government will move ahead to other insider trading cases with a powerful wind at its back. Prosecutors are no doubt confident they have developed a winning formula that resonates with jurors.

The verdict may have others in the hedge fund industry shaking. The verdict indeed led to the sell-off of hedge fund companies that trade publically. And the verdict may well have other hedge fund managers even more wary of speaking candidly on the phone, even if they have done nothing wrong. Someone could be listening in.

For more:
- here's a look at prison sentences for others

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