Saturday, 27 August 2016
Last updated 11 hours ago
May 6 2010 | 11:27am ET
Rajat Gupta, the former McKinsey & Co. head alleged to have passed inside information to Galleon Group founder Raj Rajaratnam, is no longer to be a member of the Goldman Sachs board. But Gupta continues to be paid handsomely for his services to Russia’s Sberbank.
Gupta is set to earn €429,000 for his work on the state-owned bank last year, Reuters reports. The figure makes him the highest-paid member of the Sberbank board. Gupta was also the highest-paid member of Sberbank’s board in 2008, when he earned about €430,000.
Gupta joined the Sberbank supervisory board that year.
Gupta served as head of McKinsey from 1994 through 2003. Last month, he was identified by The Wall Street Journal as a Rajaratnam tipster, allegedly passing on confidential information about Berkshire Hathaway’s $5 billion investment in Goldman Sachs in 2008.
Rajaratnam, accused of leading a $50 million insider-trading ring, and Gupta have been close friends and business partners for decades. Gupta has denied any wrongdoing.
“During the course of his long career, Rajat Gupta has been involved with many business dealings and philanthropic activities,” his lawyer, Gary Naftalis, said. “In all his activities, he has always conducted himself with unquestioned integrity.”
“Mr. Rajaratnam has had a well-known relationship with Mr. Gupta for many years, and it is one that he is both proud and found of,” Jim McCarthy, a spokesman for the Galleon founder, said yesterday. Rajaratnam has pleaded not guilty to insider-trading charges and has denied any wrongdoing, as well.
“Their association as investors has led to many successful ventures around the world and made a large and positive impact for a long list of worthy businesses and charities,” McCarthy added. “But, just as important, they have always conducted those efforts with integrity and diligent attention to sound, ethical practices.”