Monday, 24 October 2016
Last updated 2 days ago
Oct 24 2012 | 5:03pm ET
Rajat Gupta, the former head of consulting giant McKinsey & Co., was sentenced to two years in prison today for passing tips to Raj Rajaratnam.
Gupta had faced up to a decade in prison, and prosecutors had pushed for something more in line with the eight to 10 years called for by sentencing guidelines. But Gupta's lawyers had pushed for a no-jail sentence, arguing instead for probation and community service.
Gupta, who was convicted in June of passing tips gleaned during his service on the board of directors at Goldman Sachs and Procter & Gamble, was also fined $5 million.
"His conduct has forever tarnished a once-sterling reputation that took years to cultivate," U.S. Attorney Preet Bharara said. "We hope that others who might consider breaking the securities laws will take heed from this sad occasion and choose not to follow in Mr. Gupta's footsteps."
Gupta is a longtime friend and business partner of Rajaratnam. The Galleon Group founder was convicted of insider-trading last year and is serving an 11-year sentence. Gupta did not testify in Rajaratnam's trial, but was heard on a wiretap, which was also used against him at his own trial. Prosecutors also pointed to a call Gupta made just minutes after a Goldman board conference call to Rajaratnam, allegedly to tell him about an impending investment in the bank by Berkshire Hathaway.