Gupta Case Goes To Jury

Jun 14 2012 | 12:45pm ET

The judge in the Rajat Gupta trial handed the former McKinsey & Co. chief’s fate to the jury, after lawyers for both sides sparred in closing arguments.

Deliberations are under way at the lower Manhattan courthouse, with four men and eight women mulling six counts of conspiracy and securities fraud against Gupta, who is accused of passing confidential information to Galleon Group founder Raj Rajaratnam. If convicted, the former Goldman Sachs and Procter & Gamble director could face decades in prison.

Yesterday, prosecutors and Gupta’s defense lawyers spent six hours summing up their cases. Assistant U.S. Attorney Richard Tarlowe called the evidence against Gupta, which included taped phone calls and Galleon trading records, “overwhelming” and “devastating,” while Gupta’s chief lawyer, Gary Naftalis, derided the government’s case for its lack of “real, hard, direct evidence.”

“Where’s the beef in this case?” Naftalis asked. “We have had no real first-hand knowledge of the crimes alleged to have been committed here.”

Not so, according to Tarlowe.

“Gupta abused his position as a corporate insider by providing secret information to his longtime business partner and friend, Raj Rajaratnam, so Mr. Rajaratnam could use that information to buy and sell stocks before the investing public,” he said. “By doing so, Gupta enabled Rajaratnam to make millions of dollars.”

“Time and time again Gupta betrayed that trust and violated that duty by using the secret information to help Rajaratnam cash in on at.”

As for the defense’s claim that there’s no evidence, Tarlowe pointed to one of the government’s primary counts against Gupta, that he gave Rajaratnam advanced warning of Berkshire Hathaway’s 2008 investment in Goldman. He said that Galleon bought 200,000 of the bank’s shares after an “urgent” call to Rajaratnam’s direct line.

“And that call was from Gupta,” he said. “That evidence is devastating.”


In Depth

GSAM's Papagiannis: Liquid Alternatives For The Long Run

Apr 21 2017 | 8:44pm ET

Interest in liquid alternatives cooled a bit last year amid a broad shift in investor...

Lifestyle

Aston Martin Returns To Debt Market As DB11 Drives Turnaround

Mar 31 2017 | 5:21pm ET

James Bond’s preferred carmaker is returning to the public debt markets for the...

Guest Contributor

Debunking Conventional Investment Wisdom (Part II)

Apr 17 2017 | 5:56pm ET

The alternative investment industry is currently replete with buzzwords around data...

 

From the current issue of