Former Goldman Sachs director faces sentencing
NEW YORK — Rajat Gupta, the ex-Goldman Sachs director found guilty of insider trading, was to be sentenced Wednesday and wants the judge to have him do charity work in Rwanda rather than time in a US prison.
Gupta, 63, faces between eight and 10 years behind bars if prosecutors get their way. He was convicted in June of spilling boardroom secrets to his friend Raj Rajaratnam, the former Galleon hedge fund tycoon who was sentenced last year to 11 years prison, also for insider trading.
In addition to his place on the Goldman Sachs board, Gupta once headed the renowned consultancy McKinsey & Co, and was a director of Procter & Gamble, making him one of the most successful Indian-born businessmen in the United States.
With his conviction after a three-week trial, he became the biggest scalp for fellow Indian immigrant Preet Bharara, the chief federal prosecutor for Manhattan who has made a name for himself with a crackdown on Rajaratnam’s insider trading network.
But defense lawyer Gary Naftalis is asking Judge Jed Rakoff for leniency — and suggesting an unusual alternative to prison.
Citing Gupta’s longtime involvement in charity, particularly in fighting AIDS, malaria and other diseases afflicting developing countries, Naftalis suggested the ruined Wall Street figure be sent to work with the poor in Rwanda.
He would work alongside the US aid organization CARE USA in rural districts, performing community service “that could potentially provide great benefits to large numbers of Rwandans desperately in need of help, and which Mr. Gupta is uniquely situated to perform. Moreover, it would require Mr. Gupta to confront significant hardships.”
Another suggestion by the defense is for Gupta to work in New York with Covenant House, which helps the homeless.
However, prosecutors said in their own pre-sentencing letter to Rakoff that “a significant term of imprisonment is necessary to reflect the seriousness of Gupta’s crimes and to deter other corporate insiders in similar positions from stealing corporate secrets and engaging in a crime that has become far too common.”
“Gupta’s crimes are shocking,” the prosecution said, stressing that Gupta had had access to insider information precisely because he was so trusted.
Prominent public figures, including former UN secretary general Kofi Annan and Microsoft founder Bill Gates, have come to Gupta’s aid, writing to the court to take into consideration his previous good works.
According to his lawyers, Gupta has already been punished enough to deter others in his position, simply by virtue of his stunning fall from grace.
“His once sterling reputation, built over decades, has been irreparably shattered, and his business and philanthropic accomplishments tainted,” the memorandum to Rakoff read.