Thursday, 24 July 2014
Last updated 13 hours ago
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.”
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…