Rajat Gupta disgraced leader of corporate world of United States has been sentenced for two years in prison for Insider Trading. Rajat Gupta was Managing Director of Mc Kinsey and headed the top consultancy of world for more than a decade. Rajat Gupta originally from India did his graduation from IIT Delhi and went on to become a Harvad MBA as a Baker Scholar. He is considered as first Indian to ever head any global western MNC.
On June 15 2012, Rajat Gupta was found guilty by a jury of one count of conspiracy and three counts of substantive securities fraud, in connection with providing material non-public information to Raj Rajaratnam. In their sentence The Manhattan Court has said that the heart of the Rajat Gupta offence is “His abuse of position of trust“.
Rajat Gupta case is extreme of contrast in nature. Rajat Gupta has committed the crime of Insider Trading but he has not made a single penny. In the Judgement order court has also stated that The Court can say “without exaggeration that it has never encountered a defendant whose prior history suggests such an extraordinary devotion, not only to humanity writ large, but also to individual human beings in their times of need”.
On the issue of motive of Mr Gupta to commit the crime court has stated that “ Since motive is not an element of the offenses here in issue, it did not need to be proved at trial, and so one can only speculate”. The speculation as per court is t Gupta, though not immediately profiting from tipping Rajaratnam, viewed it as an avenue to future benefits, opportunities, and even excitement.
Rajat Gupta has been sentenced to two years imprisonment and $5 million fine. There is no doubt that he called Rajaratnam on two counts and Rajratnam used the information to earn profit. It will always be a point of speculation about the motive of Rajat Gupta to pass on information and as the Judgement order say we can only speculate.
Plesae read the judgement. It is an interesting read and tell us about your views.